Correlation Between HK Electric and Aya Gold
Can any of the company-specific risk be diversified away by investing in both HK Electric and Aya Gold 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 HK Electric and Aya Gold into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between HK Electric Investments and Aya Gold Silver, you can compare the effects of market volatilities on HK Electric and Aya Gold 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 HK Electric with a short position of Aya Gold. Check out your portfolio center. Please also check ongoing floating volatility patterns of HK Electric and Aya Gold.
Diversification Opportunities for HK Electric and Aya Gold
-0.84 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between HKT and Aya is -0.84. Overlapping area represents the amount of risk that can be diversified away by holding HK Electric Investments and Aya Gold Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aya Gold Silver and HK Electric 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 HK Electric Investments are associated (or correlated) with Aya Gold. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aya Gold Silver has no effect on the direction of HK Electric i.e., HK Electric and Aya Gold go up and down completely randomly.
Pair Corralation between HK Electric and Aya Gold
Assuming the 90 days trading horizon HK Electric Investments is expected to generate 0.42 times more return on investment than Aya Gold. However, HK Electric Investments is 2.4 times less risky than Aya Gold. It trades about 0.17 of its potential returns per unit of risk. Aya Gold Silver is currently generating about -0.42 per unit of risk. If you would invest 63.00 in HK Electric Investments on October 11, 2024 and sell it today you would earn a total of 2.00 from holding HK Electric Investments or generate 3.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HK Electric Investments vs. Aya Gold Silver
Performance |
| Timeline |
| HK Electric Investments |
| Aya Gold Silver |
HK Electric and Aya Gold Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HK Electric and Aya Gold
The main advantage of trading using opposite HK Electric and Aya Gold positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HK Electric position performs unexpectedly, Aya Gold 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 Aya Gold will offset losses from the drop in Aya Gold's long position.| HK Electric vs. Scientific Games | HK Electric vs. GigaMedia | HK Electric vs. GAMING FAC SA | HK Electric vs. Yuexiu Transport Infrastructure |
| Aya Gold vs. ECHO INVESTMENT ZY | Aya Gold vs. SLR Investment Corp | Aya Gold vs. DIVERSIFIED ROYALTY | Aya Gold vs. HK Electric Investments |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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