Correlation Between CapitaLand Investment and Yamaha
Can any of the company-specific risk be diversified away by investing in both CapitaLand Investment and Yamaha 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 Yamaha 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 Yamaha Motor Co, you can compare the effects of market volatilities on CapitaLand Investment and Yamaha 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 Yamaha. Check out your portfolio center. Please also check ongoing floating volatility patterns of CapitaLand Investment and Yamaha.
Diversification Opportunities for CapitaLand Investment and Yamaha
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CapitaLand and Yamaha is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding CapitaLand Investment Limited and Yamaha Motor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yamaha Motor 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 Yamaha. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yamaha Motor has no effect on the direction of CapitaLand Investment i.e., CapitaLand Investment and Yamaha go up and down completely randomly.
Pair Corralation between CapitaLand Investment and Yamaha
Assuming the 90 days horizon CapitaLand Investment Limited is expected to generate 0.97 times more return on investment than Yamaha. However, CapitaLand Investment Limited is 1.03 times less risky than Yamaha. It trades about 0.07 of its potential returns per unit of risk. Yamaha Motor Co is currently generating about -0.03 per unit of risk. If you would invest 171.00 in CapitaLand Investment Limited on November 29, 2024 and sell it today you would earn a total of 5.00 from holding CapitaLand Investment Limited or generate 2.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
CapitaLand Investment Limited vs. Yamaha Motor Co
Performance |
| Timeline |
| CapitaLand Investment |
| Yamaha Motor |
CapitaLand Investment and Yamaha Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CapitaLand Investment and Yamaha
The main advantage of trading using opposite CapitaLand Investment and Yamaha positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CapitaLand Investment position performs unexpectedly, Yamaha 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 Yamaha will offset losses from the drop in Yamaha's long position.| CapitaLand Investment vs. Stag Industrial | CapitaLand Investment vs. Grupo Carso SAB | CapitaLand Investment vs. BORR DRILLING NEW | CapitaLand Investment vs. ADRIATIC METALS LS 013355 |
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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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