Correlation Between Hutchison Port and Kawasaki Kisen
Can any of the company-specific risk be diversified away by investing in both Hutchison Port and Kawasaki Kisen 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 Port and Kawasaki Kisen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hutchison Port Holdings and Kawasaki Kisen Kaisha, you can compare the effects of market volatilities on Hutchison Port and Kawasaki Kisen 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 Port with a short position of Kawasaki Kisen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hutchison Port and Kawasaki Kisen.
Diversification Opportunities for Hutchison Port and Kawasaki Kisen
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Hutchison and Kawasaki is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Hutchison Port Holdings and Kawasaki Kisen Kaisha in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kawasaki Kisen Kaisha and Hutchison Port 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 Port Holdings are associated (or correlated) with Kawasaki Kisen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kawasaki Kisen Kaisha has no effect on the direction of Hutchison Port i.e., Hutchison Port and Kawasaki Kisen go up and down completely randomly.
Pair Corralation between Hutchison Port and Kawasaki Kisen
Assuming the 90 days horizon Hutchison Port Holdings is expected to generate 1.36 times more return on investment than Kawasaki Kisen. However, Hutchison Port is 1.36 times more volatile than Kawasaki Kisen Kaisha. It trades about 0.16 of its potential returns per unit of risk. Kawasaki Kisen Kaisha is currently generating about 0.04 per unit of risk. If you would invest 251.00 in Hutchison Port Holdings on September 2, 2024 and sell it today you would earn a total of 94.00 from holding Hutchison Port Holdings or generate 37.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 98.46% |
| Values | Daily Returns |
Hutchison Port Holdings vs. Kawasaki Kisen Kaisha
Performance |
| Timeline |
| Hutchison Port Holdings |
| Kawasaki Kisen Kaisha |
Hutchison Port and Kawasaki Kisen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hutchison Port and Kawasaki Kisen
The main advantage of trading using opposite Hutchison Port and Kawasaki Kisen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hutchison Port position performs unexpectedly, Kawasaki Kisen 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 Kawasaki Kisen will offset losses from the drop in Kawasaki Kisen's long position.| Hutchison Port vs. AP Mller | Hutchison Port vs. COSCO SHIPPING Holdings | Hutchison Port vs. Orient Overseas Limited |
| Kawasaki Kisen vs. Pacific Basin Shipping | Kawasaki Kisen vs. Hapag Lloyd Aktiengesellschaft | Kawasaki Kisen vs. Hapag Lloyd Aktiengesellschaft | Kawasaki Kisen vs. Hutchison Port Holdings |
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 Directory module to find actively traded commodities issued by global exchanges.
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