Correlation Between HOYA Resort and CKM Building
Can any of the company-specific risk be diversified away by investing in both HOYA Resort and CKM Building 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 HOYA Resort and CKM Building into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HOYA Resort Hotel and CKM Building Material, you can compare the effects of market volatilities on HOYA Resort and CKM Building 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 HOYA Resort with a short position of CKM Building. Check out your portfolio center. Please also check ongoing floating volatility patterns of HOYA Resort and CKM Building.
Diversification Opportunities for HOYA Resort and CKM Building
0.38 | Correlation Coefficient |
Weak diversification
The 3 months correlation between HOYA and CKM is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding HOYA Resort Hotel and CKM Building Material in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CKM Building Material and HOYA Resort 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 HOYA Resort Hotel are associated (or correlated) with CKM Building. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CKM Building Material has no effect on the direction of HOYA Resort i.e., HOYA Resort and CKM Building go up and down completely randomly.
Pair Corralation between HOYA Resort and CKM Building
Assuming the 90 days trading horizon HOYA Resort Hotel is expected to under-perform the CKM Building. In addition to that, HOYA Resort is 1.01 times more volatile than CKM Building Material. It trades about -0.33 of its total potential returns per unit of risk. CKM Building Material is currently generating about -0.08 per unit of volatility. If you would invest 3,465 in CKM Building Material on September 3, 2024 and sell it today you would lose (85.00) from holding CKM Building Material or give up 2.45% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HOYA Resort Hotel vs. CKM Building Material
Performance |
| Timeline |
| HOYA Resort Hotel |
| CKM Building Material |
HOYA Resort and CKM Building Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HOYA Resort and CKM Building
The main advantage of trading using opposite HOYA Resort and CKM Building positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HOYA Resort position performs unexpectedly, CKM Building 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 CKM Building will offset losses from the drop in CKM Building's long position.| HOYA Resort vs. Formosa International Hotels | HOYA Resort vs. Ambassador Hotel | HOYA Resort vs. FDC International Hotels | HOYA Resort vs. First Hotel Co |
| CKM Building vs. Sunspring Metal Corp | CKM Building vs. Champion Building Materials | CKM Building vs. Ruentex Development Co | CKM Building vs. Symtek Automation Asia |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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