Correlation Between Chuangs China and Aozora Bank
Can any of the company-specific risk be diversified away by investing in both Chuangs China and Aozora Bank 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 Chuangs China and Aozora Bank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chuangs China Investments and Aozora Bank, you can compare the effects of market volatilities on Chuangs China and Aozora Bank 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 Chuangs China with a short position of Aozora Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chuangs China and Aozora Bank.
Diversification Opportunities for Chuangs China and Aozora Bank
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Chuangs and Aozora is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Chuangs China Investments and Aozora Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aozora Bank and Chuangs China 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 Chuangs China Investments are associated (or correlated) with Aozora Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aozora Bank has no effect on the direction of Chuangs China i.e., Chuangs China and Aozora Bank go up and down completely randomly.
Pair Corralation between Chuangs China and Aozora Bank
If you would invest 1.00 in Chuangs China Investments on October 15, 2024 and sell it today you would earn a total of 0.00 from holding Chuangs China Investments or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chuangs China Investments vs. Aozora Bank
Performance |
| Timeline |
| Chuangs China Investments |
| Aozora Bank |
Chuangs China and Aozora Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chuangs China and Aozora Bank
The main advantage of trading using opposite Chuangs China and Aozora Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chuangs China position performs unexpectedly, Aozora Bank 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 Aozora Bank will offset losses from the drop in Aozora Bank's long position.| Chuangs China vs. Corporate Office Properties | Chuangs China vs. OFFICE DEPOT | Chuangs China vs. GEELY AUTOMOBILE | Chuangs China vs. Thai Beverage Public |
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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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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