Correlation Between Kee Tai and Chainqui Construction
Can any of the company-specific risk be diversified away by investing in both Kee Tai and Chainqui Construction at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Kee Tai and Chainqui Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kee Tai Properties and Chainqui Construction Development, you can compare the effects of market volatilities on Kee Tai and Chainqui Construction and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Kee Tai with a short position of Chainqui Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kee Tai and Chainqui Construction.
Diversification Opportunities for Kee Tai and Chainqui Construction
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kee and Chainqui is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Kee Tai Properties and Chainqui Construction Developm in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chainqui Construction and Kee Tai is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Kee Tai Properties are associated (or correlated) with Chainqui Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chainqui Construction has no effect on the direction of Kee Tai i.e., Kee Tai and Chainqui Construction go up and down completely randomly.
Pair Corralation between Kee Tai and Chainqui Construction
Assuming the 90 days trading horizon Kee Tai Properties is expected to generate 0.91 times more return on investment than Chainqui Construction. However, Kee Tai Properties is 1.09 times less risky than Chainqui Construction. It trades about -0.16 of its potential returns per unit of risk. Chainqui Construction Development is currently generating about -0.18 per unit of risk. If you would invest 1,615 in Kee Tai Properties on October 26, 2024 and sell it today you would lose (215.00) from holding Kee Tai Properties or give up 13.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kee Tai Properties vs. Chainqui Construction Developm
Performance |
| Timeline |
| Kee Tai Properties |
| Chainqui Construction |
Kee Tai and Chainqui Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kee Tai and Chainqui Construction
The main advantage of trading using opposite Kee Tai and Chainqui Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kee Tai position performs unexpectedly, Chainqui Construction can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Chainqui Construction will offset losses from the drop in Chainqui Construction's long position.| Kee Tai vs. Hung Sheng Construction | Kee Tai vs. Chainqui Construction Development | Kee Tai vs. BES Engineering Co | Kee Tai vs. Long Bon International |
| Chainqui Construction vs. Hung Sheng Construction | Chainqui Construction vs. Kee Tai Properties | Chainqui Construction vs. BES Engineering Co | Chainqui Construction vs. Zinwell |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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