Correlation Between Contemporary Amperex and Shenzhen Transsion
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By analyzing existing cross correlation between Contemporary Amperex Technology and Shenzhen Transsion Holdings, you can compare the effects of market volatilities on Contemporary Amperex and Shenzhen Transsion 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 Contemporary Amperex with a short position of Shenzhen Transsion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Contemporary Amperex and Shenzhen Transsion.
Diversification Opportunities for Contemporary Amperex and Shenzhen Transsion
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Contemporary and Shenzhen is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Contemporary Amperex Technolog and Shenzhen Transsion Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Transsion and Contemporary Amperex 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 Contemporary Amperex Technology are associated (or correlated) with Shenzhen Transsion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Transsion has no effect on the direction of Contemporary Amperex i.e., Contemporary Amperex and Shenzhen Transsion go up and down completely randomly.
Pair Corralation between Contemporary Amperex and Shenzhen Transsion
Assuming the 90 days trading horizon Contemporary Amperex Technology is expected to generate 0.79 times more return on investment than Shenzhen Transsion. However, Contemporary Amperex Technology is 1.27 times less risky than Shenzhen Transsion. It trades about 0.08 of its potential returns per unit of risk. Shenzhen Transsion Holdings is currently generating about -0.01 per unit of risk. If you would invest 16,285 in Contemporary Amperex Technology on August 25, 2024 and sell it today you would earn a total of 9,625 from holding Contemporary Amperex Technology or generate 59.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Contemporary Amperex Technolog vs. Shenzhen Transsion Holdings
Performance |
| Timeline |
| Contemporary Amperex |
| Shenzhen Transsion |
Contemporary Amperex and Shenzhen Transsion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Contemporary Amperex and Shenzhen Transsion
The main advantage of trading using opposite Contemporary Amperex and Shenzhen Transsion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Contemporary Amperex position performs unexpectedly, Shenzhen Transsion 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 Shenzhen Transsion will offset losses from the drop in Shenzhen Transsion's long position.| Contemporary Amperex vs. Harbin Air Conditioning | Contemporary Amperex vs. Markor International Home | Contemporary Amperex vs. Anhui Huilong Agricultural | Contemporary Amperex vs. Hunan Tyen Machinery |
| Shenzhen Transsion vs. Guangzhou Automobile Group | Shenzhen Transsion vs. Huasi Agricultural Development | Shenzhen Transsion vs. Sinomach General Machinery | Shenzhen Transsion vs. Lutian Machinery Co |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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