Correlation Between ANTA SPORTS and Hongkong Land

Can any of the company-specific risk be diversified away by investing in both ANTA SPORTS and Hongkong Land 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 ANTA SPORTS and Hongkong Land into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ANTA SPORTS PRODUCT and Hongkong Land Holdings, you can compare the effects of market volatilities on ANTA SPORTS and Hongkong Land 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 ANTA SPORTS with a short position of Hongkong Land. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANTA SPORTS and Hongkong Land.

Diversification Opportunities for ANTA SPORTS and Hongkong Land

-0.09

Correlation Coefficient

ANTA SPORTS  Hongkong Land

Good diversification

The 3 months correlation between ANTA and Hongkong is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding ANTA SPORTS PRODUCT and Hongkong Land Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hongkong Land Holdings and ANTA SPORTS 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 ANTA SPORTS PRODUCT are associated (or correlated) with Hongkong Land. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hongkong Land Holdings has no effect on the direction of ANTA SPORTS i.e., ANTA SPORTS and Hongkong Land go up and down completely randomly.

Pair Corralation between ANTA SPORTS and Hongkong Land

Assuming the 90 days trading horizon ANTA SPORTS is expected to generate 1.28 times less return on investment than Hongkong Land. In addition to that, ANTA SPORTS is 1.48 times more volatile than Hongkong Land Holdings. It trades about 0.08 of its total potential returns per unit of risk. Hongkong Land Holdings is currently generating about 0.16 per unit of volatility. If you would invest  326.00  in Hongkong Land Holdings on September 19, 2024 and sell it today you would earn a total of  104.00  from holding Hongkong Land Holdings or generate 31.9% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

ANTA SPORTS PRODUCT  vs.  Hongkong Land Holdings

ANTA SPORTS PRODUCT

Risk-Adjusted Performance

6 of 100

Modest

Compared to the overall equity markets, risk-adjusted returns on investments in ANTA SPORTS PRODUCT are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of rather fragile basic indicators, ANTA SPORTS exhibited solid returns over the last few months and may actually be approaching a breakup point.

Hongkong Land Holdings

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Hongkong Land Holdings are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, Hongkong Land reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with ANTA SPORTS and Hongkong Land

The main advantage of trading using opposite ANTA SPORTS and Hongkong Land positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANTA SPORTS position performs unexpectedly, Hongkong Land 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 Hongkong Land will offset losses from the drop in Hongkong Land's long position.

The idea behind ANTA SPORTS PRODUCT and Hongkong Land Holdings 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.

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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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.