Correlation Between Advanced Info and Sino Land
Can any of the company-specific risk be diversified away by investing in both Advanced Info and Sino Land 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 Advanced Info and Sino Land into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Advanced Info Service and Sino Land, you can compare the effects of market volatilities on Advanced Info and Sino Land 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 Advanced Info with a short position of Sino Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advanced Info and Sino Land.
Diversification Opportunities for Advanced Info and Sino Land
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Advanced and Sino is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Info Service and Sino Land in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sino Land and Advanced Info 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 Advanced Info Service are associated (or correlated) with Sino Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sino Land has no effect on the direction of Advanced Info i.e., Advanced Info and Sino Land go up and down completely randomly.
Pair Corralation between Advanced Info and Sino Land
Assuming the 90 days trading horizon Advanced Info Service is expected to generate 1.22 times more return on investment than Sino Land. However, Advanced Info is 1.22 times more volatile than Sino Land. It trades about 0.22 of its potential returns per unit of risk. Sino Land is currently generating about 0.07 per unit of risk. If you would invest 725.00 in Advanced Info Service on August 28, 2024 and sell it today you would earn a total of 60.00 from holding Advanced Info Service or generate 8.28% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.45% |
| Values | Daily Returns |
Advanced Info Service vs. Sino Land
Performance |
| Timeline |
| Advanced Info Service |
| Sino Land |
Advanced Info and Sino Land Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advanced Info and Sino Land
The main advantage of trading using opposite Advanced Info and Sino Land positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advanced Info position performs unexpectedly, Sino Land 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 Sino Land will offset losses from the drop in Sino Land's long position.The idea behind Advanced Info Service and Sino Land pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Sino Land vs. Lendlease Group | Sino Land vs. KENEDIX OFFICE INV | Sino Land vs. 24SEVENOFFICE GROUP AB | Sino Land vs. VARIOUS EATERIES LS |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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