Correlation Between Chongqing Changan and Suzhou Cheersson
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By analyzing existing cross correlation between Chongqing Changan Automobile and Suzhou Cheersson Precision, you can compare the effects of market volatilities on Chongqing Changan and Suzhou Cheersson 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 Chongqing Changan with a short position of Suzhou Cheersson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Changan and Suzhou Cheersson.
Diversification Opportunities for Chongqing Changan and Suzhou Cheersson
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Chongqing and Suzhou is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Changan Automobile and Suzhou Cheersson Precision in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suzhou Cheersson Pre and Chongqing Changan 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 Chongqing Changan Automobile are associated (or correlated) with Suzhou Cheersson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suzhou Cheersson Pre has no effect on the direction of Chongqing Changan i.e., Chongqing Changan and Suzhou Cheersson go up and down completely randomly.
Pair Corralation between Chongqing Changan and Suzhou Cheersson
Assuming the 90 days trading horizon Chongqing Changan Automobile is expected to generate 0.78 times more return on investment than Suzhou Cheersson. However, Chongqing Changan Automobile is 1.28 times less risky than Suzhou Cheersson. It trades about 0.01 of its potential returns per unit of risk. Suzhou Cheersson Precision is currently generating about 0.01 per unit of risk. If you would invest 1,300 in Chongqing Changan Automobile on October 11, 2024 and sell it today you would lose (33.00) from holding Chongqing Changan Automobile or give up 2.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chongqing Changan Automobile vs. Suzhou Cheersson Precision
Performance |
| Timeline |
| Chongqing Changan |
| Suzhou Cheersson Pre |
Chongqing Changan and Suzhou Cheersson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chongqing Changan and Suzhou Cheersson
The main advantage of trading using opposite Chongqing Changan and Suzhou Cheersson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Changan position performs unexpectedly, Suzhou Cheersson 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 Suzhou Cheersson will offset losses from the drop in Suzhou Cheersson's long position.| Chongqing Changan vs. Eastroc Beverage Group | Chongqing Changan vs. Chenzhou Jingui Silver | Chongqing Changan vs. JCHX Mining Management | Chongqing Changan vs. Guangxi Wuzhou Communications |
| Suzhou Cheersson vs. Chongqing Changan Automobile | Suzhou Cheersson vs. HaiXin Foods Co | Suzhou Cheersson vs. Shandong Longda Meat | Suzhou Cheersson vs. Sichuan Teway Food |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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