Correlation Between China Vanke and Harbor Custom
Can any of the company-specific risk be diversified away by investing in both China Vanke and Harbor Custom 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 China Vanke and Harbor Custom into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Vanke Co and Harbor Custom Development, you can compare the effects of market volatilities on China Vanke and Harbor Custom 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 China Vanke with a short position of Harbor Custom. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Vanke and Harbor Custom.
Diversification Opportunities for China Vanke and Harbor Custom
-0.5 | Correlation Coefficient |
Very good diversification
The 3 months correlation between China and Harbor is -0.5. Overlapping area represents the amount of risk that can be diversified away by holding China Vanke Co and Harbor Custom Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Harbor Custom Development and China Vanke 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 China Vanke Co are associated (or correlated) with Harbor Custom. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Harbor Custom Development has no effect on the direction of China Vanke i.e., China Vanke and Harbor Custom go up and down completely randomly.
Pair Corralation between China Vanke and Harbor Custom
If you would invest 51.00 in China Vanke Co on August 28, 2024 and sell it today you would earn a total of 48.00 from holding China Vanke Co or generate 94.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 1.56% |
| Values | Daily Returns |
China Vanke Co vs. Harbor Custom Development
Performance |
| Timeline |
| China Vanke |
| Harbor Custom Development |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
China Vanke and Harbor Custom Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Vanke and Harbor Custom
The main advantage of trading using opposite China Vanke and Harbor Custom positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Vanke position performs unexpectedly, Harbor Custom 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 Harbor Custom will offset losses from the drop in Harbor Custom's long position.| China Vanke vs. Alset Ehome International | China Vanke vs. Sino Land Co | China Vanke vs. Holiday Island Holdings | China Vanke vs. Sun Hung Kai |
| Harbor Custom vs. Alset Ehome International | Harbor Custom vs. American Realty Investors | Harbor Custom vs. Forestar Group | Harbor Custom vs. Landsea Homes Corp |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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