Correlation Between KBC Ancora and GANGLONG CHINA
Can any of the company-specific risk be diversified away by investing in both KBC Ancora and GANGLONG CHINA 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 KBC Ancora and GANGLONG CHINA into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between KBC Ancora SCA and GANGLONG CHINA PRGRLTD, you can compare the effects of market volatilities on KBC Ancora and GANGLONG CHINA 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 KBC Ancora with a short position of GANGLONG CHINA. Check out your portfolio center. Please also check ongoing floating volatility patterns of KBC Ancora and GANGLONG CHINA.
Diversification Opportunities for KBC Ancora and GANGLONG CHINA
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between KBC and GANGLONG is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding KBC Ancora SCA and GANGLONG CHINA PRGRLTD in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GANGLONG CHINA PRGRLTD and KBC Ancora 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 KBC Ancora SCA are associated (or correlated) with GANGLONG CHINA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GANGLONG CHINA PRGRLTD has no effect on the direction of KBC Ancora i.e., KBC Ancora and GANGLONG CHINA go up and down completely randomly.
Pair Corralation between KBC Ancora and GANGLONG CHINA
Assuming the 90 days horizon KBC Ancora is expected to generate 72.71 times less return on investment than GANGLONG CHINA. But when comparing it to its historical volatility, KBC Ancora SCA is 49.7 times less risky than GANGLONG CHINA. It trades about 0.05 of its potential returns per unit of risk. GANGLONG CHINA PRGRLTD is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 6.50 in GANGLONG CHINA PRGRLTD on October 28, 2024 and sell it today you would lose (5.60) from holding GANGLONG CHINA PRGRLTD or give up 86.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
KBC Ancora SCA vs. GANGLONG CHINA PRGRLTD
Performance |
| Timeline |
| KBC Ancora SCA |
| GANGLONG CHINA PRGRLTD |
KBC Ancora and GANGLONG CHINA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with KBC Ancora and GANGLONG CHINA
The main advantage of trading using opposite KBC Ancora and GANGLONG CHINA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if KBC Ancora position performs unexpectedly, GANGLONG CHINA 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 GANGLONG CHINA will offset losses from the drop in GANGLONG CHINA's long position.| KBC Ancora vs. Neinor Homes SA | KBC Ancora vs. Focus Home Interactive | KBC Ancora vs. Hisense Home Appliances | KBC Ancora vs. KENEDIX OFFICE INV |
| GANGLONG CHINA vs. China Resources Land | GANGLONG CHINA vs. CTP NV EO | GANGLONG CHINA vs. Superior Plus Corp | GANGLONG CHINA vs. Origin Agritech |
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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