Correlation Between Hutchison Telecommunicatio and Accent
Can any of the company-specific risk be diversified away by investing in both Hutchison Telecommunicatio and Accent 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 Hutchison Telecommunicatio and Accent into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hutchison Telecommunications and Accent Group, you can compare the effects of market volatilities on Hutchison Telecommunicatio and Accent 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 Hutchison Telecommunicatio with a short position of Accent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hutchison Telecommunicatio and Accent.
Diversification Opportunities for Hutchison Telecommunicatio and Accent
-0.45 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hutchison and Accent is -0.45. Overlapping area represents the amount of risk that can be diversified away by holding Hutchison Telecommunications and Accent Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Accent Group and Hutchison Telecommunicatio 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 Hutchison Telecommunications are associated (or correlated) with Accent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Accent Group has no effect on the direction of Hutchison Telecommunicatio i.e., Hutchison Telecommunicatio and Accent go up and down completely randomly.
Pair Corralation between Hutchison Telecommunicatio and Accent
Assuming the 90 days trading horizon Hutchison Telecommunications is expected to under-perform the Accent. In addition to that, Hutchison Telecommunicatio is 1.66 times more volatile than Accent Group. It trades about -0.02 of its total potential returns per unit of risk. Accent Group is currently generating about 0.09 per unit of volatility. If you would invest 190.00 in Accent Group on September 3, 2024 and sell it today you would earn a total of 57.00 from holding Accent Group or generate 30.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hutchison Telecommunications vs. Accent Group
Performance |
| Timeline |
| Hutchison Telecommunicatio |
| Accent Group |
Hutchison Telecommunicatio and Accent Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hutchison Telecommunicatio and Accent
The main advantage of trading using opposite Hutchison Telecommunicatio and Accent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hutchison Telecommunicatio position performs unexpectedly, Accent 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 Accent will offset losses from the drop in Accent's long position.| Hutchison Telecommunicatio vs. Encounter Resources | Hutchison Telecommunicatio vs. Tlou Energy | Hutchison Telecommunicatio vs. Superior Resources | Hutchison Telecommunicatio vs. Peel Mining |
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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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