Correlation Between COL Digital and Changchun
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By analyzing existing cross correlation between COL Digital Publishing and Changchun UP Optotech, you can compare the effects of market volatilities on COL Digital and Changchun 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 COL Digital with a short position of Changchun. Check out your portfolio center. Please also check ongoing floating volatility patterns of COL Digital and Changchun.
Diversification Opportunities for COL Digital and Changchun
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between COL and Changchun is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding COL Digital Publishing and Changchun UP Optotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changchun UP Optotech and COL Digital 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 COL Digital Publishing are associated (or correlated) with Changchun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changchun UP Optotech has no effect on the direction of COL Digital i.e., COL Digital and Changchun go up and down completely randomly.
Pair Corralation between COL Digital and Changchun
Assuming the 90 days trading horizon COL Digital Publishing is expected to generate 1.43 times more return on investment than Changchun. However, COL Digital is 1.43 times more volatile than Changchun UP Optotech. It trades about 0.16 of its potential returns per unit of risk. Changchun UP Optotech is currently generating about 0.23 per unit of risk. If you would invest 1,710 in COL Digital Publishing on August 25, 2024 and sell it today you would earn a total of 1,073 from holding COL Digital Publishing or generate 62.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
COL Digital Publishing vs. Changchun UP Optotech
Performance |
| Timeline |
| COL Digital Publishing |
| Changchun UP Optotech |
COL Digital and Changchun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with COL Digital and Changchun
The main advantage of trading using opposite COL Digital and Changchun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if COL Digital position performs unexpectedly, Changchun 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 Changchun will offset losses from the drop in Changchun's long position.| COL Digital vs. Industrial and Commercial | COL Digital vs. Agricultural Bank of | COL Digital vs. China Construction Bank | COL Digital vs. Bank of China |
| Changchun vs. Huatian Hotel Group | Changchun vs. BTG Hotels Group | Changchun vs. Nexchip Semiconductor Corp | Changchun vs. Jinling Hotel Corp |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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