Correlation Between Qingdao Choho and Qumei Furniture
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By analyzing existing cross correlation between Qingdao Choho Industrial and Qumei Furniture Group, you can compare the effects of market volatilities on Qingdao Choho and Qumei Furniture 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 Qingdao Choho with a short position of Qumei Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qingdao Choho and Qumei Furniture.
Diversification Opportunities for Qingdao Choho and Qumei Furniture
0.44 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Qingdao and Qumei is 0.44. Overlapping area represents the amount of risk that can be diversified away by holding Qingdao Choho Industrial and Qumei Furniture Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qumei Furniture Group and Qingdao Choho 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 Qingdao Choho Industrial are associated (or correlated) with Qumei Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qumei Furniture Group has no effect on the direction of Qingdao Choho i.e., Qingdao Choho and Qumei Furniture go up and down completely randomly.
Pair Corralation between Qingdao Choho and Qumei Furniture
Assuming the 90 days trading horizon Qingdao Choho Industrial is expected to generate 0.76 times more return on investment than Qumei Furniture. However, Qingdao Choho Industrial is 1.32 times less risky than Qumei Furniture. It trades about 0.06 of its potential returns per unit of risk. Qumei Furniture Group is currently generating about -0.03 per unit of risk. If you would invest 2,365 in Qingdao Choho Industrial on October 29, 2024 and sell it today you would earn a total of 865.00 from holding Qingdao Choho Industrial or generate 36.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qingdao Choho Industrial vs. Qumei Furniture Group
Performance |
| Timeline |
| Qingdao Choho Industrial |
| Qumei Furniture Group |
Qingdao Choho and Qumei Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qingdao Choho and Qumei Furniture
The main advantage of trading using opposite Qingdao Choho and Qumei Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qingdao Choho position performs unexpectedly, Qumei Furniture 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 Qumei Furniture will offset losses from the drop in Qumei Furniture's long position.| Qingdao Choho vs. Shanghai Yanpu Metal | Qingdao Choho vs. Shanghai Jinfeng Wine | Qingdao Choho vs. Gansu Huangtai Wine marketing | Qingdao Choho vs. CITIC Metal Co |
| Qumei Furniture vs. Haima Automobile Group | Qumei Furniture vs. Zotye Automobile Co | Qumei Furniture vs. Anhui Jianghuai Automobile | Qumei Furniture vs. Quectel Wireless Solutions |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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