Correlation Between Expeditors International and CHINA HUARONG
Can any of the company-specific risk be diversified away by investing in both Expeditors International and CHINA HUARONG 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 Expeditors International and CHINA HUARONG into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Expeditors International of and CHINA HUARONG ENERHD 50, you can compare the effects of market volatilities on Expeditors International and CHINA HUARONG 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 Expeditors International with a short position of CHINA HUARONG. Check out your portfolio center. Please also check ongoing floating volatility patterns of Expeditors International and CHINA HUARONG.
Diversification Opportunities for Expeditors International and CHINA HUARONG
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Expeditors and CHINA is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Expeditors International of and CHINA HUARONG ENERHD 50 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHINA HUARONG ENERHD and Expeditors International 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 Expeditors International of are associated (or correlated) with CHINA HUARONG. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHINA HUARONG ENERHD has no effect on the direction of Expeditors International i.e., Expeditors International and CHINA HUARONG go up and down completely randomly.
Pair Corralation between Expeditors International and CHINA HUARONG
Assuming the 90 days horizon Expeditors International of is expected to generate 0.12 times more return on investment than CHINA HUARONG. However, Expeditors International of is 8.2 times less risky than CHINA HUARONG. It trades about 0.12 of its potential returns per unit of risk. CHINA HUARONG ENERHD 50 is currently generating about -0.03 per unit of risk. If you would invest 10,810 in Expeditors International of on September 1, 2024 and sell it today you would earn a total of 480.00 from holding Expeditors International of or generate 4.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Expeditors International of vs. CHINA HUARONG ENERHD 50
Performance |
| Timeline |
| Expeditors International |
| CHINA HUARONG ENERHD |
Expeditors International and CHINA HUARONG Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Expeditors International and CHINA HUARONG
The main advantage of trading using opposite Expeditors International and CHINA HUARONG positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Expeditors International position performs unexpectedly, CHINA HUARONG 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 CHINA HUARONG will offset losses from the drop in CHINA HUARONG's long position.| Expeditors International vs. BW OFFSHORE LTD | Expeditors International vs. CSSC Offshore Marine | Expeditors International vs. Global Ship Lease | Expeditors International vs. CPU SOFTWAREHOUSE |
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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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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