Correlation Between EGRNF and Country Garden
Can any of the company-specific risk be diversified away by investing in both EGRNF and Country Garden 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 EGRNF and Country Garden into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EGRNF and Country Garden Holdings, you can compare the effects of market volatilities on EGRNF and Country Garden 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 EGRNF with a short position of Country Garden. Check out your portfolio center. Please also check ongoing floating volatility patterns of EGRNF and Country Garden.
Diversification Opportunities for EGRNF and Country Garden
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between EGRNF and Country is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding EGRNF and Country Garden Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Country Garden Holdings and EGRNF 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 EGRNF are associated (or correlated) with Country Garden. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Country Garden Holdings has no effect on the direction of EGRNF i.e., EGRNF and Country Garden go up and down completely randomly.
Pair Corralation between EGRNF and Country Garden
Assuming the 90 days horizon EGRNF is expected to generate 15.39 times more return on investment than Country Garden. However, EGRNF is 15.39 times more volatile than Country Garden Holdings. It trades about 0.15 of its potential returns per unit of risk. Country Garden Holdings is currently generating about 0.02 per unit of risk. If you would invest 11.00 in EGRNF on August 28, 2024 and sell it today you would lose (10.97) from holding EGRNF or give up 99.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 98.79% |
| Values | Daily Returns |
EGRNF vs. Country Garden Holdings
Performance |
| Timeline |
| EGRNF |
| Country Garden Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
EGRNF and Country Garden Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EGRNF and Country Garden
The main advantage of trading using opposite EGRNF and Country Garden positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EGRNF position performs unexpectedly, Country Garden 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 Country Garden will offset losses from the drop in Country Garden's long position.| EGRNF vs. Hong Kong Land | EGRNF vs. Wharf Holdings | EGRNF vs. Holiday Island Holdings | EGRNF vs. Sun Hung Kai |
| Country Garden vs. Longfor Properties Co | Country Garden vs. China Overseas Land | Country Garden vs. Country Garden Holdings | Country Garden vs. China Resources Land |
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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