Correlation Between Hapag-Lloyd and Qingdao Port
Can any of the company-specific risk be diversified away by investing in both Hapag-Lloyd and Qingdao Port 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 Hapag-Lloyd and Qingdao Port into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hapag Lloyd AG and Qingdao Port International, you can compare the effects of market volatilities on Hapag-Lloyd and Qingdao Port 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 Hapag-Lloyd with a short position of Qingdao Port. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hapag-Lloyd and Qingdao Port.
Diversification Opportunities for Hapag-Lloyd and Qingdao Port
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hapag-Lloyd and Qingdao is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Hapag Lloyd AG and Qingdao Port International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qingdao Port Interna and Hapag-Lloyd 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 Hapag Lloyd AG are associated (or correlated) with Qingdao Port. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qingdao Port Interna has no effect on the direction of Hapag-Lloyd i.e., Hapag-Lloyd and Qingdao Port go up and down completely randomly.
Pair Corralation between Hapag-Lloyd and Qingdao Port
Assuming the 90 days trading horizon Hapag Lloyd AG is expected to under-perform the Qingdao Port. In addition to that, Hapag-Lloyd is 2.06 times more volatile than Qingdao Port International. It trades about -0.16 of its total potential returns per unit of risk. Qingdao Port International is currently generating about 0.11 per unit of volatility. If you would invest 72.00 in Qingdao Port International on October 20, 2024 and sell it today you would earn a total of 2.00 from holding Qingdao Port International or generate 2.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hapag Lloyd AG vs. Qingdao Port International
Performance |
| Timeline |
| Hapag Lloyd AG |
| Qingdao Port Interna |
Hapag-Lloyd and Qingdao Port Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hapag-Lloyd and Qingdao Port
The main advantage of trading using opposite Hapag-Lloyd and Qingdao Port positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hapag-Lloyd position performs unexpectedly, Qingdao Port 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 Qingdao Port will offset losses from the drop in Qingdao Port's long position.| Hapag-Lloyd vs. Nippon Yusen Kabushiki | Hapag-Lloyd vs. Orient Overseas Limited | Hapag-Lloyd vs. Mitsui OSK Lines | Hapag-Lloyd vs. Kawasaki Kisen Kaisha |
| Qingdao Port vs. Nippon Yusen Kabushiki | Qingdao Port vs. Hapag Lloyd AG | Qingdao Port vs. Orient Overseas Limited | Qingdao Port vs. Mitsui OSK Lines |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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