Correlation Between SIEM OFFSHORE and Hongkong

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

By analyzing existing cross correlation between SIEM OFFSHORE NEW and The Hongkong and, you can compare the effects of market volatilities on SIEM OFFSHORE and Hongkong 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 SIEM OFFSHORE with a short position of Hongkong. Check out your portfolio center. Please also check ongoing floating volatility patterns of SIEM OFFSHORE and Hongkong.

Diversification Opportunities for SIEM OFFSHORE and Hongkong

-0.25

Correlation Coefficient

SIEM OFFSHORE  Hongkong

Very good diversification

The 3 months correlation between SIEM and Hongkong is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding SIEM OFFSHORE NEW and The Hongkong and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on The Hongkong and SIEM OFFSHORE 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 SIEM OFFSHORE NEW are associated (or correlated) with Hongkong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of The Hongkong has no effect on the direction of SIEM OFFSHORE i.e., SIEM OFFSHORE and Hongkong go up and down completely randomly.

Pair Corralation between SIEM OFFSHORE and Hongkong

Assuming the 90 days trading horizon SIEM OFFSHORE NEW is expected to generate 9.67 times more return on investment than Hongkong. However, SIEM OFFSHORE is 9.67 times more volatile than The Hongkong and. It trades about 0.03 of its potential returns per unit of risk. The Hongkong and is currently generating about -0.08 per unit of risk. If you would invest  204.00  in SIEM OFFSHORE NEW on October 26, 2024 and sell it today you would lose (2.00) from holding SIEM OFFSHORE NEW or give up 0.98% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	94.74%
Values	Daily Returns

SIEM OFFSHORE NEW  vs.  The Hongkong and

SIEM OFFSHORE NEW

Risk-Adjusted Performance

0 of 100

Very Weak

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

The Hongkong

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in The Hongkong and are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, Hongkong reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with SIEM OFFSHORE and Hongkong

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

The idea behind SIEM OFFSHORE NEW and The Hongkong and 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.