Correlation Between Swire Pacific and Cibl
Can any of the company-specific risk be diversified away by investing in both Swire Pacific and Cibl 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 Swire Pacific and Cibl into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Swire Pacific Ltd and Cibl Inc, you can compare the effects of market volatilities on Swire Pacific and Cibl 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 Swire Pacific with a short position of Cibl. Check out your portfolio center. Please also check ongoing floating volatility patterns of Swire Pacific and Cibl.
Diversification Opportunities for Swire Pacific and Cibl
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Swire and Cibl is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Swire Pacific Ltd and Cibl Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cibl Inc and Swire Pacific 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 Swire Pacific Ltd are associated (or correlated) with Cibl. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cibl Inc has no effect on the direction of Swire Pacific i.e., Swire Pacific and Cibl go up and down completely randomly.
Pair Corralation between Swire Pacific and Cibl
Assuming the 90 days horizon Swire Pacific Ltd is expected to generate 2.21 times more return on investment than Cibl. However, Swire Pacific is 2.21 times more volatile than Cibl Inc. It trades about 0.02 of its potential returns per unit of risk. Cibl Inc is currently generating about 0.0 per unit of risk. If you would invest 653.00 in Swire Pacific Ltd on September 3, 2024 and sell it today you would earn a total of 15.00 from holding Swire Pacific Ltd or generate 2.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.2% |
| Values | Daily Returns |
Swire Pacific Ltd vs. Cibl Inc
Performance |
| Timeline |
| Swire Pacific |
| Cibl Inc |
Swire Pacific and Cibl Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Swire Pacific and Cibl
The main advantage of trading using opposite Swire Pacific and Cibl positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Swire Pacific position performs unexpectedly, Cibl 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 Cibl will offset losses from the drop in Cibl's long position.| Swire Pacific vs. CITIC Limited | Swire Pacific vs. Fosun International | Swire Pacific vs. Cibl Inc | Swire Pacific vs. Jardine Matheson Holdings |
| Cibl vs. Telefonica Brasil SA | Cibl vs. Vodafone Group PLC | Cibl vs. Grupo Televisa SAB | Cibl vs. America Movil SAB |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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