Correlation Between Concraft Holding and Hang Seng
Can any of the company-specific risk be diversified away by investing in both Concraft Holding and Hang Seng 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 Concraft Holding and Hang Seng into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Concraft Holding Co and Hang Seng Bank, you can compare the effects of market volatilities on Concraft Holding and Hang Seng 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 Concraft Holding with a short position of Hang Seng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Concraft Holding and Hang Seng.
Diversification Opportunities for Concraft Holding and Hang Seng
-0.52 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Concraft and Hang is -0.52. Overlapping area represents the amount of risk that can be diversified away by holding Concraft Holding Co and Hang Seng Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hang Seng Bank and Concraft Holding 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 Concraft Holding Co are associated (or correlated) with Hang Seng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hang Seng Bank has no effect on the direction of Concraft Holding i.e., Concraft Holding and Hang Seng go up and down completely randomly.
Pair Corralation between Concraft Holding and Hang Seng
Assuming the 90 days trading horizon Concraft Holding Co is expected to under-perform the Hang Seng. In addition to that, Concraft Holding is 2.05 times more volatile than Hang Seng Bank. It trades about -0.23 of its total potential returns per unit of risk. Hang Seng Bank is currently generating about -0.11 per unit of volatility. If you would invest 1,249 in Hang Seng Bank on August 30, 2024 and sell it today you would lose (44.00) from holding Hang Seng Bank or give up 3.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Concraft Holding Co vs. Hang Seng Bank
Performance |
| Timeline |
| Concraft Holding |
| Hang Seng Bank |
Concraft Holding and Hang Seng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Concraft Holding and Hang Seng
The main advantage of trading using opposite Concraft Holding and Hang Seng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Concraft Holding position performs unexpectedly, Hang Seng 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 Hang Seng will offset losses from the drop in Hang Seng's long position.| Concraft Holding vs. Merry Electronics Co | Concraft Holding vs. Flexium Interconnect | Concraft Holding vs. General Interface Solution | Concraft Holding vs. Genius Electronic Optical |
| Hang Seng vs. Permanent TSB Group | Hang Seng vs. Japan Post Holdings | Hang Seng vs. Commercial International Bank | Hang Seng vs. Kasikornbank Public Co |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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