Correlation Between ANTA SPORTS and Sea
Can any of the company-specific risk be diversified away by investing in both ANTA SPORTS and Sea 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 ANTA SPORTS and Sea into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ANTA SPORTS PRODUCT and Sea Limited, you can compare the effects of market volatilities on ANTA SPORTS and Sea 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 ANTA SPORTS with a short position of Sea. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANTA SPORTS and Sea.
Diversification Opportunities for ANTA SPORTS and Sea
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between ANTA and Sea is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding ANTA SPORTS PRODUCT and Sea Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sea Limited and ANTA SPORTS 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 ANTA SPORTS PRODUCT are associated (or correlated) with Sea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sea Limited has no effect on the direction of ANTA SPORTS i.e., ANTA SPORTS and Sea go up and down completely randomly.
Pair Corralation between ANTA SPORTS and Sea
Assuming the 90 days trading horizon ANTA SPORTS is expected to generate 4.23 times less return on investment than Sea. In addition to that, ANTA SPORTS is 1.43 times more volatile than Sea Limited. It trades about 0.04 of its total potential returns per unit of risk. Sea Limited is currently generating about 0.27 per unit of volatility. If you would invest 9,820 in Sea Limited on September 15, 2024 and sell it today you would earn a total of 1,240 from holding Sea Limited or generate 12.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ANTA SPORTS PRODUCT vs. Sea Limited
Performance |
| Timeline |
| ANTA SPORTS PRODUCT |
| Sea Limited |
ANTA SPORTS and Sea Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ANTA SPORTS and Sea
The main advantage of trading using opposite ANTA SPORTS and Sea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANTA SPORTS position performs unexpectedly, Sea 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 Sea will offset losses from the drop in Sea's long position.| ANTA SPORTS vs. Apple Inc | ANTA SPORTS vs. Apple Inc | ANTA SPORTS vs. Apple Inc | ANTA SPORTS vs. Apple Inc |
| Sea vs. ANTA SPORTS PRODUCT | Sea vs. DICKS Sporting Goods | Sea vs. China Communications Services | Sea vs. USWE SPORTS AB |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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