Correlation Between Bentley SystemsInc and China Index

Specify exactly 2 symbols:
Can any of the company-specific risk be diversified away by investing in both Bentley SystemsInc and China Index 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 Bentley SystemsInc and China Index into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Bentley SystemsInc and China Index Holdings, you can compare the effects of market volatilities on Bentley SystemsInc and China Index 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 Bentley SystemsInc with a short position of China Index. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bentley SystemsInc and China Index.

Diversification Opportunities for Bentley SystemsInc and China Index

-0.05
  Correlation Coefficient

Good diversification

The 3 months correlation between Bentley and China is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Bentley SystemsInc and China Index Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Index Holdings and Bentley SystemsInc 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 Bentley SystemsInc are associated (or correlated) with China Index. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Index Holdings has no effect on the direction of Bentley SystemsInc i.e., Bentley SystemsInc and China Index go up and down completely randomly.

Pair Corralation between Bentley SystemsInc and China Index

If you would invest  95.00  in China Index Holdings on December 19, 2023 and sell it today you would earn a total of  0.00  from holding China Index Holdings or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionMoves Against 
StrengthInsignificant
Accuracy4.76%
ValuesDaily Returns

Bentley SystemsInc  vs.  China Index Holdings

 Performance 
       Timeline  
Bentley SystemsInc 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days Bentley SystemsInc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly strong basic indicators, Bentley SystemsInc is not utilizing all of its potentials. The recent stock price disturbance, may contribute to short-term losses for the investors.
China Index Holdings 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days China Index Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong forward indicators, China Index is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Bentley SystemsInc and China Index Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with Bentley SystemsInc and China Index

The main advantage of trading using opposite Bentley SystemsInc and China Index positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bentley SystemsInc position performs unexpectedly, China Index 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 China Index will offset losses from the drop in China Index's long position.
The idea behind Bentley SystemsInc and China Index 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.
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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.

Other Complementary Tools

Premium Stories
Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope
Portfolio Diagnostics
Use generated alerts and portfolio events aggregator to diagnose current holdings
Global Correlations
Find global opportunities by holding instruments from different markets
Volatility Analysis
Get historical volatility and risk analysis based on latest market data
Portfolio Analyzer
Portfolio analysis module that provides access to portfolio diagnostics and optimization engine
Options Analysis
Analyze and evaluate options and option chains as a potential hedge for your portfolios
Competition Analyzer
Analyze and compare many basic indicators for a group of related or unrelated entities
Alpha Finder
Use alpha and beta coefficients to find investment opportunities after accounting for the risk