Correlation Between Aquagold International and Matthews China
Can any of the company-specific risk be diversified away by investing in both Aquagold International and Matthews China 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 Aquagold International and Matthews China into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Aquagold International and Matthews China Dividend, you can compare the effects of market volatilities on Aquagold International and Matthews China 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 Aquagold International with a short position of Matthews China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aquagold International and Matthews China.
Diversification Opportunities for Aquagold International and Matthews China
-0.2 | Correlation Coefficient |
Good diversification
The 3 months correlation between Aquagold and Matthews is -0.2. Overlapping area represents the amount of risk that can be diversified away by holding Aquagold International and Matthews China Dividend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Matthews China Dividend and Aquagold International 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 Aquagold International are associated (or correlated) with Matthews China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Matthews China Dividend has no effect on the direction of Aquagold International i.e., Aquagold International and Matthews China go up and down completely randomly.
Pair Corralation between Aquagold International and Matthews China
Given the investment horizon of 90 days Aquagold International is expected to generate 36.8 times more return on investment than Matthews China. However, Aquagold International is 36.8 times more volatile than Matthews China Dividend. It trades about 0.05 of its potential returns per unit of risk. Matthews China Dividend is currently generating about 0.0 per unit of risk. If you would invest 25.00 in Aquagold International on November 27, 2024 and sell it today you would lose (24.98) from holding Aquagold International or give up 99.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.4% |
| Values | Daily Returns |
Aquagold International vs. Matthews China Dividend
Performance |
| Timeline |
| Aquagold International |
| Matthews China Dividend |
Aquagold International and Matthews China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aquagold International and Matthews China
The main advantage of trading using opposite Aquagold International and Matthews China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aquagold International position performs unexpectedly, Matthews China 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 Matthews China will offset losses from the drop in Matthews China's long position.| Aquagold International vs. PepsiCo | Aquagold International vs. Coca Cola Consolidated | Aquagold International vs. Monster Beverage Corp | Aquagold International vs. Celsius Holdings |
| Matthews China vs. Matthews China Small | Matthews China vs. Matthews Asia Dividend | Matthews China vs. Matthews Asia Small | Matthews China vs. Matthews Asia Growth |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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