Correlation Between Hutchison Telecommunicatio and Regal Funds
Can any of the company-specific risk be diversified away by investing in both Hutchison Telecommunicatio and Regal Funds 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 Regal Funds into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hutchison Telecommunications and Regal Funds Management, you can compare the effects of market volatilities on Hutchison Telecommunicatio and Regal Funds 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 Regal Funds. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hutchison Telecommunicatio and Regal Funds.
Diversification Opportunities for Hutchison Telecommunicatio and Regal Funds
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Hutchison and Regal is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Hutchison Telecommunications and Regal Funds Management in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Regal Funds Management 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 Regal Funds. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Regal Funds Management has no effect on the direction of Hutchison Telecommunicatio i.e., Hutchison Telecommunicatio and Regal Funds go up and down completely randomly.
Pair Corralation between Hutchison Telecommunicatio and Regal Funds
Assuming the 90 days trading horizon Hutchison Telecommunications is expected to under-perform the Regal Funds. In addition to that, Hutchison Telecommunicatio is 1.78 times more volatile than Regal Funds Management. It trades about -0.11 of its total potential returns per unit of risk. Regal Funds Management is currently generating about 0.11 per unit of volatility. If you would invest 383.00 in Regal Funds Management on August 28, 2024 and sell it today you would earn a total of 19.00 from holding Regal Funds Management or generate 4.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hutchison Telecommunications vs. Regal Funds Management
Performance |
| Timeline |
| Hutchison Telecommunicatio |
| Regal Funds Management |
Hutchison Telecommunicatio and Regal Funds Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hutchison Telecommunicatio and Regal Funds
The main advantage of trading using opposite Hutchison Telecommunicatio and Regal Funds positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hutchison Telecommunicatio position performs unexpectedly, Regal Funds 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 Regal Funds will offset losses from the drop in Regal Funds' long position.| Hutchison Telecommunicatio vs. Macquarie Group | Hutchison Telecommunicatio vs. CSL | Hutchison Telecommunicatio vs. Commonwealth Bank of | Hutchison Telecommunicatio vs. Commonwealth Bank of |
| Regal Funds vs. National Australia Bank | Regal Funds vs. National Australia Bank | Regal Funds vs. Westpac Banking | Regal Funds vs. National Australia 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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