Correlation Between GRENKELEASING Dusseldorf and China Overseas

Can any of the company-specific risk be diversified away by investing in both GRENKELEASING Dusseldorf and China Overseas 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 GRENKELEASING Dusseldorf and China Overseas into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GRENKELEASING Dusseldorf and China Overseas Land, you can compare the effects of market volatilities on GRENKELEASING Dusseldorf and China Overseas 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 GRENKELEASING Dusseldorf with a short position of China Overseas. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRENKELEASING Dusseldorf and China Overseas.

Diversification Opportunities for GRENKELEASING Dusseldorf and China Overseas

-0.17

Correlation Coefficient

GRENKELEASING Dusseldorf  China Overseas

Good diversification

The 3 months correlation between GRENKELEASING and China is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding GRENKELEASING Dusseldorf and China Overseas Land in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Overseas Land and GRENKELEASING Dusseldorf 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 GRENKELEASING Dusseldorf are associated (or correlated) with China Overseas. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Overseas Land has no effect on the direction of GRENKELEASING Dusseldorf i.e., GRENKELEASING Dusseldorf and China Overseas go up and down completely randomly.

Pair Corralation between GRENKELEASING Dusseldorf and China Overseas

Assuming the 90 days trading horizon GRENKELEASING Dusseldorf is expected to generate 0.89 times more return on investment than China Overseas. However, GRENKELEASING Dusseldorf is 1.12 times less risky than China Overseas. It trades about 0.24 of its potential returns per unit of risk. China Overseas Land is currently generating about -0.03 per unit of risk. If you would invest  1,326  in GRENKELEASING Dusseldorf on April 23, 2025 and sell it today you would earn a total of  428.00  from holding GRENKELEASING Dusseldorf or generate 32.28% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	98.44%
Values	Daily Returns

GRENKELEASING Dusseldorf  vs.  China Overseas Land

GRENKELEASING Dusseldorf

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in GRENKELEASING Dusseldorf are ranked lower than 18 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively fragile forward-looking indicators, GRENKELEASING Dusseldorf unveiled solid returns over the last few months and may actually be approaching a breakup point.

China Overseas Land

Risk-Adjusted Performance

Very Weak

Over the last 90 days China Overseas Land has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, China Overseas is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

Pair Trading with GRENKELEASING Dusseldorf and China Overseas

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

The idea behind GRENKELEASING Dusseldorf and China Overseas Land 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.