Correlation Between CK Hutchison and Keppel
Can any of the company-specific risk be diversified away by investing in both CK Hutchison and Keppel 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 CK Hutchison and Keppel into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CK Hutchison Holdings and Keppel Limited, you can compare the effects of market volatilities on CK Hutchison and Keppel 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 CK Hutchison with a short position of Keppel. Check out your portfolio center. Please also check ongoing floating volatility patterns of CK Hutchison and Keppel.
Diversification Opportunities for CK Hutchison and Keppel
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CKHUY and Keppel is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding CK Hutchison Holdings and Keppel Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Keppel Limited and CK Hutchison 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 CK Hutchison Holdings are associated (or correlated) with Keppel. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Keppel Limited has no effect on the direction of CK Hutchison i.e., CK Hutchison and Keppel go up and down completely randomly.
Pair Corralation between CK Hutchison and Keppel
Assuming the 90 days horizon CK Hutchison is expected to generate 44.0 times less return on investment than Keppel. But when comparing it to its historical volatility, CK Hutchison Holdings is 3.47 times less risky than Keppel. It trades about 0.0 of its potential returns per unit of risk. Keppel Limited is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 650.00 in Keppel Limited on September 20, 2024 and sell it today you would earn a total of 366.00 from holding Keppel Limited or generate 56.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 98.79% |
| Values | Daily Returns |
CK Hutchison Holdings vs. Keppel Limited
Performance |
| Timeline |
| CK Hutchison Holdings |
| Keppel Limited |
CK Hutchison and Keppel Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CK Hutchison and Keppel
The main advantage of trading using opposite CK Hutchison and Keppel positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CK Hutchison position performs unexpectedly, Keppel 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 Keppel will offset losses from the drop in Keppel's long position.| CK Hutchison vs. HUMANA INC | CK Hutchison vs. Barloworld Ltd ADR | CK Hutchison vs. Morningstar Unconstrained Allocation | CK Hutchison vs. Thrivent High Yield |
| Keppel vs. Arca Continental SAB | Keppel vs. Becle SA de | Keppel vs. Aquagold International | Keppel vs. Morningstar Unconstrained Allocation |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
Other Complementary Tools
| Earnings Calls Check upcoming earnings announcements updated hourly across public exchanges | |
| FinTech Suite Use AI to screen and filter profitable investment opportunities | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities |