Correlation Between Alstria Office and Chengdu PUTIAN
Can any of the company-specific risk be diversified away by investing in both Alstria Office and Chengdu PUTIAN 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 Alstria Office and Chengdu PUTIAN into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between alstria office REIT AG and Chengdu PUTIAN Telecommunications, you can compare the effects of market volatilities on Alstria Office and Chengdu PUTIAN 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 Alstria Office with a short position of Chengdu PUTIAN. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alstria Office and Chengdu PUTIAN.
Diversification Opportunities for Alstria Office and Chengdu PUTIAN
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Alstria and Chengdu is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding alstria office REIT AG and Chengdu PUTIAN Telecommunicati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chengdu PUTIAN Telec and Alstria Office 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 alstria office REIT AG are associated (or correlated) with Chengdu PUTIAN. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chengdu PUTIAN Telec has no effect on the direction of Alstria Office i.e., Alstria Office and Chengdu PUTIAN go up and down completely randomly.
Pair Corralation between Alstria Office and Chengdu PUTIAN
Assuming the 90 days horizon alstria office REIT AG is expected to under-perform the Chengdu PUTIAN. In addition to that, Alstria Office is 1.77 times more volatile than Chengdu PUTIAN Telecommunications. It trades about -0.24 of its total potential returns per unit of risk. Chengdu PUTIAN Telecommunications is currently generating about 0.16 per unit of volatility. If you would invest 7.05 in Chengdu PUTIAN Telecommunications on October 24, 2024 and sell it today you would earn a total of 0.70 from holding Chengdu PUTIAN Telecommunications or generate 9.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
alstria office REIT AG vs. Chengdu PUTIAN Telecommunicati
Performance |
| Timeline |
| alstria office REIT |
| Chengdu PUTIAN Telec |
Alstria Office and Chengdu PUTIAN Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alstria Office and Chengdu PUTIAN
The main advantage of trading using opposite Alstria Office and Chengdu PUTIAN positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alstria Office position performs unexpectedly, Chengdu PUTIAN 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 Chengdu PUTIAN will offset losses from the drop in Chengdu PUTIAN's long position.| Alstria Office vs. ELL ENVIRONHLDGS HD 0001 | Alstria Office vs. Mobilezone Holding AG | Alstria Office vs. Scandinavian Tobacco Group | Alstria Office vs. Geely Automobile Holdings |
| Chengdu PUTIAN vs. alstria office REIT AG | Chengdu PUTIAN vs. GEELY AUTOMOBILE | Chengdu PUTIAN vs. MAVEN WIRELESS SWEDEN | Chengdu PUTIAN vs. Infrastrutture Wireless Italiane |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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