Correlation Between Konfoong Materials and Dongfeng Automobile
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By analyzing existing cross correlation between Konfoong Materials International and Dongfeng Automobile Co, you can compare the effects of market volatilities on Konfoong Materials and Dongfeng Automobile 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 Konfoong Materials with a short position of Dongfeng Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Konfoong Materials and Dongfeng Automobile.
Diversification Opportunities for Konfoong Materials and Dongfeng Automobile
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Konfoong and Dongfeng is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Konfoong Materials Internation and Dongfeng Automobile Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongfeng Automobile and Konfoong Materials 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 Konfoong Materials International are associated (or correlated) with Dongfeng Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongfeng Automobile has no effect on the direction of Konfoong Materials i.e., Konfoong Materials and Dongfeng Automobile go up and down completely randomly.
Pair Corralation between Konfoong Materials and Dongfeng Automobile
Assuming the 90 days trading horizon Konfoong Materials International is expected to generate 0.81 times more return on investment than Dongfeng Automobile. However, Konfoong Materials International is 1.23 times less risky than Dongfeng Automobile. It trades about -0.06 of its potential returns per unit of risk. Dongfeng Automobile Co is currently generating about -0.25 per unit of risk. If you would invest 7,275 in Konfoong Materials International on October 30, 2024 and sell it today you would lose (246.00) from holding Konfoong Materials International or give up 3.38% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Konfoong Materials Internation vs. Dongfeng Automobile Co
Performance |
| Timeline |
| Konfoong Materials |
| Dongfeng Automobile |
Konfoong Materials and Dongfeng Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Konfoong Materials and Dongfeng Automobile
The main advantage of trading using opposite Konfoong Materials and Dongfeng Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Konfoong Materials position performs unexpectedly, Dongfeng Automobile 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 Dongfeng Automobile will offset losses from the drop in Dongfeng Automobile's long position.| Konfoong Materials vs. Jiangsu Financial Leasing | Konfoong Materials vs. Zhejiang Construction Investment | Konfoong Materials vs. Zhejiang Publishing Media | Konfoong Materials vs. Beijing Kaiwen Education |
| Dongfeng Automobile vs. Miracll Chemicals Co | Dongfeng Automobile vs. Aba Chemicals Corp | Dongfeng Automobile vs. Dr Peng Telecom | Dongfeng Automobile vs. Ziel Home Furnishing |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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