Correlation Between Longfor Properties and Bayport International
Can any of the company-specific risk be diversified away by investing in both Longfor Properties and Bayport International 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 Longfor Properties and Bayport International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Longfor Properties Co and Bayport International Holdings, you can compare the effects of market volatilities on Longfor Properties and Bayport International 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 Longfor Properties with a short position of Bayport International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Longfor Properties and Bayport International.
Diversification Opportunities for Longfor Properties and Bayport International
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Longfor and Bayport is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Longfor Properties Co and Bayport International Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bayport International and Longfor Properties 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 Longfor Properties Co are associated (or correlated) with Bayport International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bayport International has no effect on the direction of Longfor Properties i.e., Longfor Properties and Bayport International go up and down completely randomly.
Pair Corralation between Longfor Properties and Bayport International
Assuming the 90 days horizon Longfor Properties Co is expected to under-perform the Bayport International. But the pink sheet apears to be less risky and, when comparing its historical volatility, Longfor Properties Co is 16.12 times less risky than Bayport International. The pink sheet trades about -0.01 of its potential returns per unit of risk. The Bayport International Holdings is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 0.80 in Bayport International Holdings on November 2, 2024 and sell it today you would lose (0.79) from holding Bayport International Holdings or give up 98.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Longfor Properties Co vs. Bayport International Holdings
Performance |
| Timeline |
| Longfor Properties |
| Bayport International |
Longfor Properties and Bayport International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Longfor Properties and Bayport International
The main advantage of trading using opposite Longfor Properties and Bayport International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Longfor Properties position performs unexpectedly, Bayport International 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 Bayport International will offset losses from the drop in Bayport International's long position.| Longfor Properties vs. Sun Hung Kai | Longfor Properties vs. Sino Land Co | Longfor Properties vs. Sun Hung Kai | Longfor Properties vs. Holiday Island Holdings |
| Bayport International vs. Hong Kong Land | Bayport International vs. Wharf Holdings | Bayport International vs. Holiday Island Holdings | Bayport International vs. Sun Hung Kai |
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..
Other Complementary Tools
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio |