Correlation Between Hong Kong and Take Two
Can any of the company-specific risk be diversified away by investing in both Hong Kong and Take Two 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 Hong Kong and Take Two into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hong Kong Land and Take Two Interactive Software, you can compare the effects of market volatilities on Hong Kong and Take Two 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 Hong Kong with a short position of Take Two. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hong Kong and Take Two.
Diversification Opportunities for Hong Kong and Take Two
Pay attention - limited upside
The 3 months correlation between Hong and Take is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Hong Kong Land and Take Two Interactive Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Take Two Interactive and Hong Kong 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 Hong Kong Land are associated (or correlated) with Take Two. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Take Two Interactive has no effect on the direction of Hong Kong i.e., Hong Kong and Take Two go up and down completely randomly.
Pair Corralation between Hong Kong and Take Two
Assuming the 90 days trading horizon Hong Kong is expected to generate 11.44 times less return on investment than Take Two. But when comparing it to its historical volatility, Hong Kong Land is 11.38 times less risky than Take Two. It trades about 0.08 of its potential returns per unit of risk. Take Two Interactive Software is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 9,904 in Take Two Interactive Software on September 12, 2024 and sell it today you would earn a total of 8,662 from holding Take Two Interactive Software or generate 87.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.0% |
| Values | Daily Returns |
Hong Kong Land vs. Take Two Interactive Software
Performance |
| Timeline |
| Hong Kong Land |
| Take Two Interactive |
Hong Kong and Take Two Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hong Kong and Take Two
The main advantage of trading using opposite Hong Kong and Take Two positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hong Kong position performs unexpectedly, Take Two 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 Take Two will offset losses from the drop in Take Two's long position.| Hong Kong vs. Wheaton Precious Metals | Hong Kong vs. Universal Display Corp | Hong Kong vs. Zoom Video Communications | Hong Kong vs. Cornish Metals |
| Take Two vs. Hong Kong Land | Take Two vs. Neometals | Take Two vs. Coor Service Management | Take Two vs. Fidelity Sustainable USD |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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