Correlation Between Yanlord Land and Hong Kong
Can any of the company-specific risk be diversified away by investing in both Yanlord Land and Hong Kong 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 Yanlord Land and Hong Kong into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Yanlord Land Group and Hong Kong Land, you can compare the effects of market volatilities on Yanlord Land and Hong Kong 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 Yanlord Land with a short position of Hong Kong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yanlord Land and Hong Kong.
Diversification Opportunities for Yanlord Land and Hong Kong
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Yanlord and Hong is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Yanlord Land Group and Hong Kong Land in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hong Kong Land and Yanlord Land 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 Yanlord Land Group are associated (or correlated) with Hong Kong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hong Kong Land has no effect on the direction of Yanlord Land i.e., Yanlord Land and Hong Kong go up and down completely randomly.
Pair Corralation between Yanlord Land and Hong Kong
If you would invest 2,369 in Hong Kong Land on September 12, 2024 and sell it today you would earn a total of 77.00 from holding Hong Kong Land or generate 3.25% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yanlord Land Group vs. Hong Kong Land
Performance |
| Timeline |
| Yanlord Land Group |
| Hong Kong Land |
Yanlord Land and Hong Kong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yanlord Land and Hong Kong
The main advantage of trading using opposite Yanlord Land and Hong Kong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yanlord Land position performs unexpectedly, Hong Kong 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 Hong Kong will offset losses from the drop in Hong Kong's long position.| Yanlord Land vs. CECO Environmental Corp | Yanlord Land vs. Sabre Corpo | Yanlord Land vs. Griffon | Yanlord Land vs. Hurco Companies |
| Hong Kong vs. Sino Land Co | Hong Kong vs. Holiday Island Holdings | Hong Kong vs. Daiwa House Industry | Hong Kong vs. China Overseas Land |
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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