Correlation Between MARKET VECTR and Hua Hong
Can any of the company-specific risk be diversified away by investing in both MARKET VECTR and Hua Hong 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 MARKET VECTR and Hua Hong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between MARKET VECTR RETAIL and Hua Hong Semiconductor, you can compare the effects of market volatilities on MARKET VECTR and Hua Hong 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 MARKET VECTR with a short position of Hua Hong. Check out your portfolio center. Please also check ongoing floating volatility patterns of MARKET VECTR and Hua Hong.
Diversification Opportunities for MARKET VECTR and Hua Hong
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between MARKET and Hua is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding MARKET VECTR RETAIL and Hua Hong Semiconductor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hua Hong Semiconductor and MARKET VECTR 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 MARKET VECTR RETAIL are associated (or correlated) with Hua Hong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hua Hong Semiconductor has no effect on the direction of MARKET VECTR i.e., MARKET VECTR and Hua Hong go up and down completely randomly.
Pair Corralation between MARKET VECTR and Hua Hong
Assuming the 90 days trading horizon MARKET VECTR RETAIL is expected to generate 0.22 times more return on investment than Hua Hong. However, MARKET VECTR RETAIL is 4.59 times less risky than Hua Hong. It trades about 0.09 of its potential returns per unit of risk. Hua Hong Semiconductor is currently generating about 0.01 per unit of risk. If you would invest 15,692 in MARKET VECTR RETAIL on October 27, 2024 and sell it today you would earn a total of 6,788 from holding MARKET VECTR RETAIL or generate 43.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.4% |
| Values | Daily Returns |
MARKET VECTR RETAIL vs. Hua Hong Semiconductor
Performance |
| Timeline |
| MARKET VECTR RETAIL |
| Hua Hong Semiconductor |
MARKET VECTR and Hua Hong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with MARKET VECTR and Hua Hong
The main advantage of trading using opposite MARKET VECTR and Hua Hong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if MARKET VECTR position performs unexpectedly, Hua Hong 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 Hua Hong will offset losses from the drop in Hua Hong's long position.| MARKET VECTR vs. Apple Inc | MARKET VECTR vs. Apple Inc | MARKET VECTR vs. Apple Inc | MARKET VECTR vs. Apple Inc |
| Hua Hong vs. RCS MediaGroup SpA | Hua Hong vs. RYANAIR HLDGS ADR | Hua Hong vs. Air New Zealand | Hua Hong vs. DELTA AIR LINES |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Other Complementary Tools
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Watchlist Optimization Optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm |