Correlation Between Hanison Construction and China Resources
Can any of the company-specific risk be diversified away by investing in both Hanison Construction and China Resources 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 Hanison Construction and China Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hanison Construction Holdings and China Resources Beer, you can compare the effects of market volatilities on Hanison Construction and China Resources 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 Hanison Construction with a short position of China Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hanison Construction and China Resources.
Diversification Opportunities for Hanison Construction and China Resources
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Hanison and China is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Hanison Construction Holdings and China Resources Beer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Resources Beer and Hanison Construction 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 Hanison Construction Holdings are associated (or correlated) with China Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Resources Beer has no effect on the direction of Hanison Construction i.e., Hanison Construction and China Resources go up and down completely randomly.
Pair Corralation between Hanison Construction and China Resources
If you would invest 14.00 in Hanison Construction Holdings on September 1, 2024 and sell it today you would earn a total of 0.00 from holding Hanison Construction Holdings or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hanison Construction Holdings vs. China Resources Beer
Performance |
| Timeline |
| Hanison Construction |
| China Resources Beer |
Hanison Construction and China Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hanison Construction and China Resources
The main advantage of trading using opposite Hanison Construction and China Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hanison Construction position performs unexpectedly, China Resources 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 Resources will offset losses from the drop in China Resources' long position.| Hanison Construction vs. Larsen Toubro Limited | Hanison Construction vs. Superior Plus Corp | Hanison Construction vs. NMI Holdings | Hanison Construction vs. Origin Agritech |
| China Resources vs. MOLSON RS BEVERAGE | China Resources vs. Superior Plus Corp | China Resources vs. NMI Holdings | China Resources vs. Origin Agritech |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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