Correlation Between AEON MALL and GuocoLand
Can any of the company-specific risk be diversified away by investing in both AEON MALL and GuocoLand 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 AEON MALL and GuocoLand into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AEON MALL LTD and GuocoLand Limited, you can compare the effects of market volatilities on AEON MALL and GuocoLand 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 AEON MALL with a short position of GuocoLand. Check out your portfolio center. Please also check ongoing floating volatility patterns of AEON MALL and GuocoLand.
Diversification Opportunities for AEON MALL and GuocoLand
Excellent diversification
The 3 months correlation between AEON and GuocoLand is -0.63. Overlapping area represents the amount of risk that can be diversified away by holding AEON MALL LTD and GuocoLand Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GuocoLand Limited and AEON MALL 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 AEON MALL LTD are associated (or correlated) with GuocoLand. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GuocoLand Limited has no effect on the direction of AEON MALL i.e., AEON MALL and GuocoLand go up and down completely randomly.
Pair Corralation between AEON MALL and GuocoLand
Assuming the 90 days horizon AEON MALL LTD is expected to generate 3.41 times more return on investment than GuocoLand. However, AEON MALL is 3.41 times more volatile than GuocoLand Limited. It trades about 0.07 of its potential returns per unit of risk. GuocoLand Limited is currently generating about 0.13 per unit of risk. If you would invest 1,070 in AEON MALL LTD on August 25, 2024 and sell it today you would earn a total of 150.00 from holding AEON MALL LTD or generate 14.02% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
AEON MALL LTD vs. GuocoLand Limited
Performance |
| Timeline |
| AEON MALL LTD |
| GuocoLand Limited |
AEON MALL and GuocoLand Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AEON MALL and GuocoLand
The main advantage of trading using opposite AEON MALL and GuocoLand positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AEON MALL position performs unexpectedly, GuocoLand 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 GuocoLand will offset losses from the drop in GuocoLand's long position.| AEON MALL vs. Dis Fastigheter AB | AEON MALL vs. Superior Plus Corp | AEON MALL vs. NMI Holdings | AEON MALL vs. Origin Agritech |
| GuocoLand vs. Dis Fastigheter AB | GuocoLand vs. Superior Plus Corp | GuocoLand vs. NMI Holdings | GuocoLand vs. Origin Agritech |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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