Correlation Between Hang Seng and Postal Savings
Can any of the company-specific risk be diversified away by investing in both Hang Seng and Postal Savings 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 Postal Savings 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 Postal Savings Bank, you can compare the effects of market volatilities on Hang Seng and Postal Savings 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 Postal Savings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hang Seng and Postal Savings.
Diversification Opportunities for Hang Seng and Postal Savings
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Hang and Postal is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Hang Seng Bank and Postal Savings Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Postal Savings Bank 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 Postal Savings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Postal Savings Bank has no effect on the direction of Hang Seng i.e., Hang Seng and Postal Savings go up and down completely randomly.
Pair Corralation between Hang Seng and Postal Savings
If you would invest 60.00 in Postal Savings Bank on August 31, 2024 and sell it today you would earn a total of 0.00 from holding Postal Savings Bank or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
Hang Seng Bank vs. Postal Savings Bank
Performance |
| Timeline |
| Hang Seng Bank |
| Postal Savings Bank |
Hang Seng and Postal Savings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hang Seng and Postal Savings
The main advantage of trading using opposite Hang Seng and Postal Savings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hang Seng position performs unexpectedly, Postal Savings 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 Postal Savings will offset losses from the drop in Postal Savings' long position.| Hang Seng vs. Bank Mandiri Persero | Hang Seng vs. Piraeus Bank SA | Hang Seng vs. Kasikornbank Public Co | Hang Seng vs. Turkiye Garanti Bankasi |
| Postal Savings vs. China Merchants Bank | Postal Savings vs. China Merchants Bank | Postal Savings vs. Community West Bancshares | Postal Savings vs. China Everbright Bank |
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 CEOs Directory module to screen CEOs from public companies around the world.
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