Correlation Between International CSRC and Data International
Can any of the company-specific risk be diversified away by investing in both International CSRC and Data International 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 International CSRC and Data International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between International CSRC Investment and Data International Co, you can compare the effects of market volatilities on International CSRC and Data International 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 International CSRC with a short position of Data International. Check out your portfolio center. Please also check ongoing floating volatility patterns of International CSRC and Data International.
Diversification Opportunities for International CSRC and Data International
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between International and Data is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding International CSRC Investment and Data International Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Data International and International CSRC 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 International CSRC Investment are associated (or correlated) with Data International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Data International has no effect on the direction of International CSRC i.e., International CSRC and Data International go up and down completely randomly.
Pair Corralation between International CSRC and Data International
Assuming the 90 days trading horizon International CSRC Investment is expected to under-perform the Data International. But the stock apears to be less risky and, when comparing its historical volatility, International CSRC Investment is 3.45 times less risky than Data International. The stock trades about -0.08 of its potential returns per unit of risk. The Data International Co is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 2,581 in Data International Co on October 28, 2024 and sell it today you would earn a total of 9,819 from holding Data International Co or generate 380.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
International CSRC Investment vs. Data International Co
Performance |
| Timeline |
| International CSRC |
| Data International |
International CSRC and Data International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with International CSRC and Data International
The main advantage of trading using opposite International CSRC and Data International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International CSRC position performs unexpectedly, Data International 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 Data International will offset losses from the drop in Data International's long position.| International CSRC vs. Nan Ya Plastics | International CSRC vs. Formosa Chemicals Fibre | International CSRC vs. China Steel Corp | International CSRC vs. Formosa Petrochemical Corp |
| Data International vs. Dawushan Farm Tech | Data International vs. Farglory FTZ Investment | Data International vs. China Metal Products | Data International vs. Te Chang Construction |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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