Correlation Between Chuangs China and TRAVEL +
Can any of the company-specific risk be diversified away by investing in both Chuangs China and TRAVEL + 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 TRAVEL + 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 TRAVEL LEISURE DL 01, you can compare the effects of market volatilities on Chuangs China and TRAVEL + 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 TRAVEL +. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chuangs China and TRAVEL +.
Diversification Opportunities for Chuangs China and TRAVEL +
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Chuangs and TRAVEL is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Chuangs China Investments and TRAVEL LEISURE DL 01 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on TRAVEL LEISURE DL 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 TRAVEL +. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of TRAVEL LEISURE DL has no effect on the direction of Chuangs China i.e., Chuangs China and TRAVEL + go up and down completely randomly.
Pair Corralation between Chuangs China and TRAVEL +
If you would invest 4,420 in TRAVEL LEISURE DL 01 on September 5, 2024 and sell it today you would earn a total of 830.00 from holding TRAVEL LEISURE DL 01 or generate 18.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chuangs China Investments vs. TRAVEL LEISURE DL 01
Performance |
| Timeline |
| Chuangs China Investments |
| TRAVEL LEISURE DL |
Chuangs China and TRAVEL + Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chuangs China and TRAVEL +
The main advantage of trading using opposite Chuangs China and TRAVEL + positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chuangs China position performs unexpectedly, TRAVEL + 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 TRAVEL + will offset losses from the drop in TRAVEL +'s long position.| Chuangs China vs. Hongkong Land Holdings | Chuangs China vs. Superior Plus Corp | Chuangs China vs. NMI Holdings | Chuangs China vs. Origin Agritech |
| TRAVEL + vs. TRIPCOM GROUP DL 00125 | TRAVEL + vs. TUI AG | TRAVEL + vs. TripAdvisor | TRAVEL + vs. ON THE BEACH |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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