Correlation Between CapitaLand Investment and 03835VAJ5

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Can any of the company-specific risk be diversified away by investing in both CapitaLand Investment and 03835VAJ5 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 CapitaLand Investment and 03835VAJ5 into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CapitaLand Investment Limited and APTV 31 01 DEC 51, you can compare the effects of market volatilities on CapitaLand Investment and 03835VAJ5 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 CapitaLand Investment with a short position of 03835VAJ5. Check out your portfolio center. Please also check ongoing floating volatility patterns of CapitaLand Investment and 03835VAJ5.

Diversification Opportunities for CapitaLand Investment and 03835VAJ5

0.49
  Correlation Coefficient

Very weak diversification

The 3 months correlation between CapitaLand and 03835VAJ5 is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding CapitaLand Investment Limited and APTV 31 01 DEC 51 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on APTV 31 01 and CapitaLand Investment 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 CapitaLand Investment Limited are associated (or correlated) with 03835VAJ5. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of APTV 31 01 has no effect on the direction of CapitaLand Investment i.e., CapitaLand Investment and 03835VAJ5 go up and down completely randomly.

Pair Corralation between CapitaLand Investment and 03835VAJ5

Assuming the 90 days horizon CapitaLand Investment Limited is expected to generate 1.07 times more return on investment than 03835VAJ5. However, CapitaLand Investment is 1.07 times more volatile than APTV 31 01 DEC 51. It trades about 0.19 of its potential returns per unit of risk. APTV 31 01 DEC 51 is currently generating about 0.02 per unit of risk. If you would invest  182.00  in CapitaLand Investment Limited on September 12, 2024 and sell it today you would earn a total of  17.00  from holding CapitaLand Investment Limited or generate 9.34% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Together 
StrengthWeak
Accuracy95.24%
ValuesDaily Returns

CapitaLand Investment Limited  vs.  APTV 31 01 DEC 51

 Performance 
       Timeline  
CapitaLand Investment 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days CapitaLand Investment Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable essential indicators, CapitaLand Investment is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.
APTV 31 01 

Risk-Adjusted Performance

0 of 100

 
Weak
 
Strong
Very Weak
Over the last 90 days APTV 31 01 DEC 51 has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Bond's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for APTV 31 01 DEC 51 investors.

CapitaLand Investment and 03835VAJ5 Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with CapitaLand Investment and 03835VAJ5

The main advantage of trading using opposite CapitaLand Investment and 03835VAJ5 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CapitaLand Investment position performs unexpectedly, 03835VAJ5 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 03835VAJ5 will offset losses from the drop in 03835VAJ5's long position.
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The idea behind CapitaLand Investment Limited and APTV 31 01 DEC 51 pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.

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