Correlation Between Hang Seng and Oconee Financial
Can any of the company-specific risk be diversified away by investing in both Hang Seng and Oconee Financial 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 Hang Seng and Oconee Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hang Seng Bank and Oconee Financial, you can compare the effects of market volatilities on Hang Seng and Oconee Financial 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 Hang Seng with a short position of Oconee Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hang Seng and Oconee Financial.
Diversification Opportunities for Hang Seng and Oconee Financial
-0.07 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hang and Oconee is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Hang Seng Bank and Oconee Financial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Oconee Financial and Hang Seng 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 Hang Seng Bank are associated (or correlated) with Oconee Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Oconee Financial has no effect on the direction of Hang Seng i.e., Hang Seng and Oconee Financial go up and down completely randomly.
Pair Corralation between Hang Seng and Oconee Financial
Assuming the 90 days horizon Hang Seng is expected to generate 1.33 times less return on investment than Oconee Financial. In addition to that, Hang Seng is 3.85 times more volatile than Oconee Financial. It trades about 0.03 of its total potential returns per unit of risk. Oconee Financial is currently generating about 0.16 per unit of volatility. If you would invest 3,707 in Oconee Financial on September 3, 2024 and sell it today you would earn a total of 193.00 from holding Oconee Financial or generate 5.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 98.46% |
| Values | Daily Returns |
Hang Seng Bank vs. Oconee Financial
Performance |
| Timeline |
| Hang Seng Bank |
| Oconee Financial |
Hang Seng and Oconee Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hang Seng and Oconee Financial
The main advantage of trading using opposite Hang Seng and Oconee Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hang Seng position performs unexpectedly, Oconee Financial 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 Oconee Financial will offset losses from the drop in Oconee Financial's long position.| Hang Seng vs. Caixabank SA ADR | Hang Seng vs. Commercial International Bank | Hang Seng vs. PT Bank Rakyat | Hang Seng vs. Riverview Bancorp |
| Oconee Financial vs. First Hawaiian | Oconee Financial vs. Central Pacific Financial | Oconee Financial vs. Territorial Bancorp | Oconee Financial vs. Comerica |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
Other Complementary Tools
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Idea Breakdown Analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Headlines Timeline Stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity |