Correlation Between Chongqing Changan and Cofoe Medical
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By analyzing existing cross correlation between Chongqing Changan Automobile and Cofoe Medical Technology, you can compare the effects of market volatilities on Chongqing Changan and Cofoe Medical 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 Cofoe Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Changan and Cofoe Medical.
Diversification Opportunities for Chongqing Changan and Cofoe Medical
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Chongqing and Cofoe is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Changan Automobile and Cofoe Medical Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cofoe Medical Technology 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 Cofoe Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cofoe Medical Technology has no effect on the direction of Chongqing Changan i.e., Chongqing Changan and Cofoe Medical go up and down completely randomly.
Pair Corralation between Chongqing Changan and Cofoe Medical
Assuming the 90 days trading horizon Chongqing Changan Automobile is expected to generate 0.93 times more return on investment than Cofoe Medical. However, Chongqing Changan Automobile is 1.07 times less risky than Cofoe Medical. It trades about 0.08 of its potential returns per unit of risk. Cofoe Medical Technology is currently generating about 0.0 per unit of risk. If you would invest 350.00 in Chongqing Changan Automobile on September 1, 2024 and sell it today you would earn a total of 11.00 from holding Chongqing Changan Automobile or generate 3.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Chongqing Changan Automobile vs. Cofoe Medical Technology
Performance |
| Timeline |
| Chongqing Changan |
| Cofoe Medical Technology |
Chongqing Changan and Cofoe Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chongqing Changan and Cofoe Medical
The main advantage of trading using opposite Chongqing Changan and Cofoe Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Changan position performs unexpectedly, Cofoe Medical 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 Cofoe Medical will offset losses from the drop in Cofoe Medical's long position.| Chongqing Changan vs. Western Metal Materials | Chongqing Changan vs. China Minmetals Rare | Chongqing Changan vs. Miracll Chemicals Co | Chongqing Changan vs. Xiangtan Electrochemical Scientific |
| Cofoe Medical vs. Nanjing Putian Telecommunications | Cofoe Medical vs. Shenzhen Hifuture Electric | Cofoe Medical vs. Tianjin Realty Development | Cofoe Medical vs. Shenyang Huitian Thermal |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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