Correlation Between Tencent Holdings and HAMMONIA Schiffsholding
Can any of the company-specific risk be diversified away by investing in both Tencent Holdings and HAMMONIA Schiffsholding 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 Tencent Holdings and HAMMONIA Schiffsholding into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tencent Holdings and HAMMONIA Schiffsholding AG, you can compare the effects of market volatilities on Tencent Holdings and HAMMONIA Schiffsholding 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 Tencent Holdings with a short position of HAMMONIA Schiffsholding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tencent Holdings and HAMMONIA Schiffsholding.
Diversification Opportunities for Tencent Holdings and HAMMONIA Schiffsholding
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Tencent and HAMMONIA is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding Tencent Holdings and HAMMONIA Schiffsholding AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HAMMONIA Schiffsholding and Tencent Holdings 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 Tencent Holdings are associated (or correlated) with HAMMONIA Schiffsholding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HAMMONIA Schiffsholding has no effect on the direction of Tencent Holdings i.e., Tencent Holdings and HAMMONIA Schiffsholding go up and down completely randomly.
Pair Corralation between Tencent Holdings and HAMMONIA Schiffsholding
Assuming the 90 days trading horizon Tencent Holdings is expected to generate 1.03 times more return on investment than HAMMONIA Schiffsholding. However, Tencent Holdings is 1.03 times more volatile than HAMMONIA Schiffsholding AG. It trades about 0.05 of its potential returns per unit of risk. HAMMONIA Schiffsholding AG is currently generating about 0.01 per unit of risk. If you would invest 4,379 in Tencent Holdings on September 1, 2024 and sell it today you would earn a total of 484.00 from holding Tencent Holdings or generate 11.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 99.24% |
| Values | Daily Returns |
Tencent Holdings vs. HAMMONIA Schiffsholding AG
Performance |
| Timeline |
| Tencent Holdings |
| HAMMONIA Schiffsholding |
Tencent Holdings and HAMMONIA Schiffsholding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tencent Holdings and HAMMONIA Schiffsholding
The main advantage of trading using opposite Tencent Holdings and HAMMONIA Schiffsholding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tencent Holdings position performs unexpectedly, HAMMONIA Schiffsholding 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 HAMMONIA Schiffsholding will offset losses from the drop in HAMMONIA Schiffsholding's long position.| Tencent Holdings vs. BYD Company Limited | Tencent Holdings vs. Alibaba Group Holdings | Tencent Holdings vs. Xiaomi | Tencent Holdings vs. Baidu Inc |
| HAMMONIA Schiffsholding vs. Qingdao Port International | HAMMONIA Schiffsholding vs. Superior Plus Corp | HAMMONIA Schiffsholding vs. NMI Holdings | HAMMONIA Schiffsholding 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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
Other Complementary Tools
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Equity Forecasting Use basic forecasting models to generate price predictions and determine price momentum | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |