Correlation Between Chia and Haw Par
Can any of the company-specific risk be diversified away by investing in both Chia and Haw Par 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 Chia and Haw Par into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chia and Haw Par, you can compare the effects of market volatilities on Chia and Haw Par 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 Chia with a short position of Haw Par. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chia and Haw Par.
Diversification Opportunities for Chia and Haw Par
Pay attention - limited upside
The 3 months correlation between Chia and Haw is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Chia and Haw Par in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Haw Par and Chia 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 Chia are associated (or correlated) with Haw Par. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Haw Par has no effect on the direction of Chia i.e., Chia and Haw Par go up and down completely randomly.
Pair Corralation between Chia and Haw Par
If you would invest 2,168 in Chia on October 20, 2024 and sell it today you would earn a total of 217.00 from holding Chia or generate 10.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 90.91% |
| Values | Daily Returns |
Chia vs. Haw Par
Performance |
| Timeline |
| Chia |
| Haw Par |
Chia and Haw Par Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chia and Haw Par
The main advantage of trading using opposite Chia and Haw Par positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chia position performs unexpectedly, Haw Par 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 Haw Par will offset losses from the drop in Haw Par's long position.The idea behind Chia and Haw Par pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Haw Par vs. Sanofi ADR | Haw Par vs. AstraZeneca PLC ADR | Haw Par vs. Roche Holding Ltd | Haw Par vs. GlaxoSmithKline PLC ADR |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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