Correlation Between ANTA SPORTS and China Resources
Can any of the company-specific risk be diversified away by investing in both ANTA SPORTS and China Resources 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 China Resources 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 China Resources Beer, you can compare the effects of market volatilities on ANTA SPORTS and China Resources 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 China Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANTA SPORTS and China Resources.
Diversification Opportunities for ANTA SPORTS and China Resources
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between ANTA and China is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding ANTA SPORTS PRODUCT and China Resources Beer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Resources Beer 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 China Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Resources Beer has no effect on the direction of ANTA SPORTS i.e., ANTA SPORTS and China Resources go up and down completely randomly.
Pair Corralation between ANTA SPORTS and China Resources
Assuming the 90 days trading horizon ANTA SPORTS is expected to generate 1.38 times less return on investment than China Resources. But when comparing it to its historical volatility, ANTA SPORTS PRODUCT is 1.07 times less risky than China Resources. It trades about 0.09 of its potential returns per unit of risk. China Resources Beer is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 228.00 in China Resources Beer on August 29, 2024 and sell it today you would earn a total of 80.00 from holding China Resources Beer or generate 35.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 98.46% |
| Values | Daily Returns |
ANTA SPORTS PRODUCT vs. China Resources Beer
Performance |
| Timeline |
| ANTA SPORTS PRODUCT |
| China Resources Beer |
ANTA SPORTS and China Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ANTA SPORTS and China Resources
The main advantage of trading using opposite ANTA SPORTS and China Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANTA SPORTS position performs unexpectedly, China Resources 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 China Resources will offset losses from the drop in China Resources' long position.| ANTA SPORTS vs. SEALED AIR | ANTA SPORTS vs. SYSTEMAIR AB | ANTA SPORTS vs. HF SINCLAIR P | ANTA SPORTS vs. Enter Air SA |
| China Resources vs. Molson Coors Brewing | China Resources vs. MOLSON RS BEVERAGE | China Resources vs. Superior Plus Corp | China Resources vs. SIVERS SEMICONDUCTORS 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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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