Correlation Between Chongqing Changan and Niutech Environment
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By analyzing existing cross correlation between Chongqing Changan Automobile and Niutech Environment Technology, you can compare the effects of market volatilities on Chongqing Changan and Niutech Environment 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 Niutech Environment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Changan and Niutech Environment.
Diversification Opportunities for Chongqing Changan and Niutech Environment
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Chongqing and Niutech is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Changan Automobile and Niutech Environment Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Niutech Environment 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 Niutech Environment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Niutech Environment has no effect on the direction of Chongqing Changan i.e., Chongqing Changan and Niutech Environment go up and down completely randomly.
Pair Corralation between Chongqing Changan and Niutech Environment
Assuming the 90 days trading horizon Chongqing Changan Automobile is expected to generate 1.18 times more return on investment than Niutech Environment. However, Chongqing Changan is 1.18 times more volatile than Niutech Environment Technology. It trades about 0.03 of its potential returns per unit of risk. Niutech Environment Technology is currently generating about -0.11 per unit of risk. If you would invest 1,370 in Chongqing Changan Automobile on August 29, 2024 and sell it today you would earn a total of 17.00 from holding Chongqing Changan Automobile or generate 1.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chongqing Changan Automobile vs. Niutech Environment Technology
Performance |
| Timeline |
| Chongqing Changan |
| Niutech Environment |
Chongqing Changan and Niutech Environment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chongqing Changan and Niutech Environment
The main advantage of trading using opposite Chongqing Changan and Niutech Environment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Changan position performs unexpectedly, Niutech Environment 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 Niutech Environment will offset losses from the drop in Niutech Environment's long position.| Chongqing Changan vs. Changchun Faway Automobile | Chongqing Changan vs. Anhui Jianghuai Automobile | Chongqing Changan vs. Great Sun Foods Co | Chongqing Changan vs. Dareway Software Co |
| Niutech Environment vs. Dhc Software Co | Niutech Environment vs. China Railway Construction | Niutech Environment vs. Long Yuan Construction | Niutech Environment vs. Guangzhou KingTeller Technology |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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