Correlation Between Beeks Trading and HUTCHMED China
Can any of the company-specific risk be diversified away by investing in both Beeks Trading and HUTCHMED 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 Beeks Trading and HUTCHMED China into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Beeks Trading and HUTCHMED China, you can compare the effects of market volatilities on Beeks Trading and HUTCHMED 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 Beeks Trading with a short position of HUTCHMED China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beeks Trading and HUTCHMED China.
Diversification Opportunities for Beeks Trading and HUTCHMED China
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Beeks and HUTCHMED is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Beeks Trading and HUTCHMED China in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HUTCHMED China and Beeks Trading 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 Beeks Trading are associated (or correlated) with HUTCHMED China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HUTCHMED China has no effect on the direction of Beeks Trading i.e., Beeks Trading and HUTCHMED China go up and down completely randomly.
Pair Corralation between Beeks Trading and HUTCHMED China
Assuming the 90 days trading horizon Beeks Trading is expected to generate 0.77 times more return on investment than HUTCHMED China. However, Beeks Trading is 1.3 times less risky than HUTCHMED China. It trades about 0.03 of its potential returns per unit of risk. HUTCHMED China is currently generating about -0.13 per unit of risk. If you would invest 28,100 in Beeks Trading on November 3, 2024 and sell it today you would earn a total of 300.00 from holding Beeks Trading or generate 1.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beeks Trading vs. HUTCHMED China
Performance |
| Timeline |
| Beeks Trading |
| HUTCHMED China |
Beeks Trading and HUTCHMED China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beeks Trading and HUTCHMED China
The main advantage of trading using opposite Beeks Trading and HUTCHMED China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beeks Trading position performs unexpectedly, HUTCHMED 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 HUTCHMED China will offset losses from the drop in HUTCHMED China's long position.| Beeks Trading vs. International Consolidated Airlines | Beeks Trading vs. Playtech Plc | Beeks Trading vs. Bloomsbury Publishing Plc | Beeks Trading vs. Rosslyn Data Technologies |
| HUTCHMED China vs. Spotify Technology SA | HUTCHMED China vs. Axway Software SA | HUTCHMED China vs. Martin Marietta Materials | HUTCHMED China vs. Take Two Interactive Software |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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