Correlation Between Chiba Bank and Hongkong
Can any of the company-specific risk be diversified away by investing in both Chiba Bank and Hongkong 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 Chiba Bank and Hongkong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chiba Bank and The Hongkong and, you can compare the effects of market volatilities on Chiba Bank and Hongkong 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 Chiba Bank with a short position of Hongkong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chiba Bank and Hongkong.
Diversification Opportunities for Chiba Bank and Hongkong
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Chiba and Hongkong is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Chiba Bank and The Hongkong and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Hongkong and Chiba Bank 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 Chiba Bank are associated (or correlated) with Hongkong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Hongkong has no effect on the direction of Chiba Bank i.e., Chiba Bank and Hongkong go up and down completely randomly.
Pair Corralation between Chiba Bank and Hongkong
Assuming the 90 days horizon Chiba Bank is expected to generate 1.53 times more return on investment than Hongkong. However, Chiba Bank is 1.53 times more volatile than The Hongkong and. It trades about 0.18 of its potential returns per unit of risk. The Hongkong and is currently generating about -0.08 per unit of risk. If you would invest 735.00 in Chiba Bank on October 26, 2024 and sell it today you would earn a total of 30.00 from holding Chiba Bank or generate 4.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 94.74% |
| Values | Daily Returns |
Chiba Bank vs. The Hongkong and
Performance |
| Timeline |
| Chiba Bank |
| The Hongkong |
Chiba Bank and Hongkong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chiba Bank and Hongkong
The main advantage of trading using opposite Chiba Bank and Hongkong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chiba Bank position performs unexpectedly, Hongkong 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 Hongkong will offset losses from the drop in Hongkong's long position.| Chiba Bank vs. Synovus Financial Corp | Chiba Bank vs. Corporate Office Properties | Chiba Bank vs. KENEDIX OFFICE INV | Chiba Bank vs. Infrastrutture Wireless Italiane |
| Hongkong vs. The Boston Beer | Hongkong vs. S E BANKEN A | Hongkong vs. Chiba Bank | Hongkong vs. Direct Line Insurance |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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