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This module allows you to analyze existing cross correlation between Hang Seng and Nasdaq. You can compare the effects of market volatilities on Hang Seng and Nasdaq 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 Hang Seng with a short position of Nasdaq. See also your portfolio center. Please also check ongoing floating volatility patterns of Hang Seng and Nasdaq.
|Horizon||30 Days Login to change|
Predicted Return Density
Hang Seng vs. Nasdaq
Given the investment horizon of 30 days, Hang Seng is expected to generate 82.5 times more return on investment than Nasdaq. However, Hang Seng is 82.5 times more volatile than Nasdaq. It trades about 0.15 of its potential returns per unit of risk. Nasdaq is currently generating about -0.08 per unit of risk. If you would invest 2,547,000 in Hang Seng on November 14, 2018 and sell it today you would earn a total of 62,479 from holding Hang Seng or generate 2.45% return on investment over 30 days.
Pair Corralation between Hang Seng and Nasdaq
|Time Period||2 Months [change]|
Diversification Opportunities for Hang Seng and Nasdaq
Overlapping area represents the amount of risk that can be diversified away by holding Hang Seng and Nasdaq in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on Nasdaq and Hang Seng 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 Hang Seng are associated (or correlated) with Nasdaq. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nasdaq has no effect on the direction of Hang Seng i.e. Hang Seng and Nasdaq go up and down completely randomly.