Correlation Between Country Garden and CapitaLand
Can any of the company-specific risk be diversified away by investing in both Country Garden and CapitaLand 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 Country Garden and CapitaLand into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Country Garden Holdings and CapitaLand Limited, you can compare the effects of market volatilities on Country Garden and CapitaLand 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 Country Garden with a short position of CapitaLand. Check out your portfolio center. Please also check ongoing floating volatility patterns of Country Garden and CapitaLand.
Diversification Opportunities for Country Garden and CapitaLand
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Country and CapitaLand is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Country Garden Holdings and CapitaLand Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CapitaLand Limited and Country Garden 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 Country Garden Holdings are associated (or correlated) with CapitaLand. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CapitaLand Limited has no effect on the direction of Country Garden i.e., Country Garden and CapitaLand go up and down completely randomly.
Pair Corralation between Country Garden and CapitaLand
If you would invest 9.00 in Country Garden Holdings on January 26, 2024 and sell it today you would lose (1.00) from holding Country Garden Holdings or give up 11.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Country Garden Holdings vs. CapitaLand Limited
Performance |
| Timeline |
| Country Garden Holdings |
| CapitaLand Limited |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Country Garden and CapitaLand Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Country Garden and CapitaLand
The main advantage of trading using opposite Country Garden and CapitaLand positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Country Garden position performs unexpectedly, CapitaLand 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 CapitaLand will offset losses from the drop in CapitaLand's long position.The idea behind Country Garden Holdings and CapitaLand Limited 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.| CapitaLand vs. Shelf Drilling | CapitaLand vs. The Mosaic | CapitaLand vs. Strategic Oil and | CapitaLand vs. Flexible Solutions International |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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