Correlation Between CapitaLand Investment and RLX TECH
Can any of the company-specific risk be diversified away by investing in both CapitaLand Investment and RLX TECH 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 CapitaLand Investment and RLX TECH into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CapitaLand Investment Limited and RLX TECH SPADR1, you can compare the effects of market volatilities on CapitaLand Investment and RLX TECH 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 CapitaLand Investment with a short position of RLX TECH. Check out your portfolio center. Please also check ongoing floating volatility patterns of CapitaLand Investment and RLX TECH.
Diversification Opportunities for CapitaLand Investment and RLX TECH
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CapitaLand and RLX is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding CapitaLand Investment Limited and RLX TECH SPADR1 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on RLX TECH SPADR1 and CapitaLand Investment 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 CapitaLand Investment Limited are associated (or correlated) with RLX TECH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of RLX TECH SPADR1 has no effect on the direction of CapitaLand Investment i.e., CapitaLand Investment and RLX TECH go up and down completely randomly.
Pair Corralation between CapitaLand Investment and RLX TECH
Assuming the 90 days horizon CapitaLand Investment Limited is expected to under-perform the RLX TECH. But the stock apears to be less risky and, when comparing its historical volatility, CapitaLand Investment Limited is 2.25 times less risky than RLX TECH. The stock trades about -0.01 of its potential returns per unit of risk. The RLX TECH SPADR1 is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 235.00 in RLX TECH SPADR1 on September 12, 2024 and sell it today you would lose (56.00) from holding RLX TECH SPADR1 or give up 23.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CapitaLand Investment Limited vs. RLX TECH SPADR1
Performance |
| Timeline |
| CapitaLand Investment |
| RLX TECH SPADR1 |
CapitaLand Investment and RLX TECH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CapitaLand Investment and RLX TECH
The main advantage of trading using opposite CapitaLand Investment and RLX TECH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CapitaLand Investment position performs unexpectedly, RLX TECH 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 RLX TECH will offset losses from the drop in RLX TECH's long position.| CapitaLand Investment vs. Superior Plus Corp | CapitaLand Investment vs. SIVERS SEMICONDUCTORS AB | CapitaLand Investment vs. Reliance Steel Aluminum | CapitaLand Investment vs. CHINA HUARONG ENERHD 50 |
| RLX TECH vs. ANTA SPORTS PRODUCT | RLX TECH vs. VIVA WINE GROUP | RLX TECH vs. ePlay Digital | RLX TECH vs. SYSTEMAIR AB |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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