Correlation Between Contemporary Amperex and Guangdong Skychem
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By analyzing existing cross correlation between Contemporary Amperex Technology and Guangdong Skychem Technology, you can compare the effects of market volatilities on Contemporary Amperex and Guangdong Skychem 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 Guangdong Skychem. Check out your portfolio center. Please also check ongoing floating volatility patterns of Contemporary Amperex and Guangdong Skychem.
Diversification Opportunities for Contemporary Amperex and Guangdong Skychem
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Contemporary and Guangdong is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Contemporary Amperex Technolog and Guangdong Skychem Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Skychem 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 Guangdong Skychem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Skychem has no effect on the direction of Contemporary Amperex i.e., Contemporary Amperex and Guangdong Skychem go up and down completely randomly.
Pair Corralation between Contemporary Amperex and Guangdong Skychem
Assuming the 90 days trading horizon Contemporary Amperex is expected to generate 2.1 times less return on investment than Guangdong Skychem. But when comparing it to its historical volatility, Contemporary Amperex Technology is 1.25 times less risky than Guangdong Skychem. It trades about 0.12 of its potential returns per unit of risk. Guangdong Skychem Technology is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 4,990 in Guangdong Skychem Technology on September 27, 2024 and sell it today you would earn a total of 7,465 from holding Guangdong Skychem Technology or generate 149.6% 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. Guangdong Skychem Technology
Performance |
| Timeline |
| Contemporary Amperex |
| Guangdong Skychem |
Contemporary Amperex and Guangdong Skychem Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Contemporary Amperex and Guangdong Skychem
The main advantage of trading using opposite Contemporary Amperex and Guangdong Skychem positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Contemporary Amperex position performs unexpectedly, Guangdong Skychem 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 Guangdong Skychem will offset losses from the drop in Guangdong Skychem's long position.| Contemporary Amperex vs. Kweichow Moutai Co | Contemporary Amperex vs. G bits Network Technology | Contemporary Amperex vs. BYD Co Ltd | Contemporary Amperex vs. Beijing Roborock Technology |
| Guangdong Skychem vs. Industrial and Commercial | Guangdong Skychem vs. Kweichow Moutai Co | Guangdong Skychem vs. Agricultural Bank of | Guangdong Skychem vs. China Mobile Limited |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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