Correlation Between AUTO TRADER and CHINA OIL
Can any of the company-specific risk be diversified away by investing in both AUTO TRADER and CHINA OIL 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 AUTO TRADER and CHINA OIL into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between AUTO TRADER ADR and CHINA OIL AND, you can compare the effects of market volatilities on AUTO TRADER and CHINA OIL 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 AUTO TRADER with a short position of CHINA OIL. Check out your portfolio center. Please also check ongoing floating volatility patterns of AUTO TRADER and CHINA OIL.
Diversification Opportunities for AUTO TRADER and CHINA OIL
-0.33 | Correlation Coefficient |
Very good diversification
The 3 months correlation between AUTO and CHINA is -0.33. Overlapping area represents the amount of risk that can be diversified away by holding AUTO TRADER ADR and CHINA OIL AND in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHINA OIL AND and AUTO TRADER 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 AUTO TRADER ADR are associated (or correlated) with CHINA OIL. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHINA OIL AND has no effect on the direction of AUTO TRADER i.e., AUTO TRADER and CHINA OIL go up and down completely randomly.
Pair Corralation between AUTO TRADER and CHINA OIL
If you would invest 248.00 in AUTO TRADER ADR on September 3, 2024 and sell it today you would earn a total of 0.00 from holding AUTO TRADER ADR or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
AUTO TRADER ADR vs. CHINA OIL AND
Performance |
| Timeline |
| AUTO TRADER ADR |
| CHINA OIL AND |
AUTO TRADER and CHINA OIL Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with AUTO TRADER and CHINA OIL
The main advantage of trading using opposite AUTO TRADER and CHINA OIL positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if AUTO TRADER position performs unexpectedly, CHINA OIL 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 CHINA OIL will offset losses from the drop in CHINA OIL's long position.| AUTO TRADER vs. Alphabet Class A | AUTO TRADER vs. Meta Platforms | AUTO TRADER vs. Meta Platforms | AUTO TRADER vs. Tencent Holdings |
| CHINA OIL vs. INSURANCE AUST GRP | CHINA OIL vs. SCANSOURCE | CHINA OIL vs. Japan Post Insurance | CHINA OIL vs. QBE Insurance Group |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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