Correlation Between CarsalesCom and HAPAG LLOYD
Can any of the company-specific risk be diversified away by investing in both CarsalesCom and HAPAG LLOYD 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 CarsalesCom and HAPAG LLOYD into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CarsalesCom and HAPAG LLOYD UNSPADR 12, you can compare the effects of market volatilities on CarsalesCom and HAPAG LLOYD 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 CarsalesCom with a short position of HAPAG LLOYD. Check out your portfolio center. Please also check ongoing floating volatility patterns of CarsalesCom and HAPAG LLOYD.
Diversification Opportunities for CarsalesCom and HAPAG LLOYD
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CarsalesCom and HAPAG is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding CarsalesCom and HAPAG LLOYD UNSPADR 12 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HAPAG LLOYD UNSPADR and CarsalesCom 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 CarsalesCom are associated (or correlated) with HAPAG LLOYD. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HAPAG LLOYD UNSPADR has no effect on the direction of CarsalesCom i.e., CarsalesCom and HAPAG LLOYD go up and down completely randomly.
Pair Corralation between CarsalesCom and HAPAG LLOYD
Assuming the 90 days horizon CarsalesCom is expected to generate 0.35 times more return on investment than HAPAG LLOYD. However, CarsalesCom is 2.89 times less risky than HAPAG LLOYD. It trades about 0.1 of its potential returns per unit of risk. HAPAG LLOYD UNSPADR 12 is currently generating about 0.03 per unit of risk. If you would invest 1,190 in CarsalesCom on September 12, 2024 and sell it today you would earn a total of 1,250 from holding CarsalesCom or generate 105.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CarsalesCom vs. HAPAG LLOYD UNSPADR 12
Performance |
| Timeline |
| CarsalesCom |
| HAPAG LLOYD UNSPADR |
CarsalesCom and HAPAG LLOYD Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CarsalesCom and HAPAG LLOYD
The main advantage of trading using opposite CarsalesCom and HAPAG LLOYD positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CarsalesCom position performs unexpectedly, HAPAG LLOYD 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 HAPAG LLOYD will offset losses from the drop in HAPAG LLOYD's long position.| CarsalesCom vs. Tencent Holdings | CarsalesCom vs. Superior Plus Corp | CarsalesCom vs. SIVERS SEMICONDUCTORS AB | CarsalesCom vs. NorAm Drilling AS |
| HAPAG LLOYD vs. Superior Plus Corp | HAPAG LLOYD vs. SIVERS SEMICONDUCTORS AB | HAPAG LLOYD vs. CHINA HUARONG ENERHD 50 | HAPAG LLOYD vs. NORDIC HALIBUT AS |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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