Correlation Between Weihai Honglin and CIMC Vehicles
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By analyzing existing cross correlation between Weihai Honglin Electronic and CIMC Vehicles Co, you can compare the effects of market volatilities on Weihai Honglin and CIMC Vehicles 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 Weihai Honglin with a short position of CIMC Vehicles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Weihai Honglin and CIMC Vehicles.
Diversification Opportunities for Weihai Honglin and CIMC Vehicles
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Weihai and CIMC is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Weihai Honglin Electronic and CIMC Vehicles Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIMC Vehicles and Weihai Honglin 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 Weihai Honglin Electronic are associated (or correlated) with CIMC Vehicles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIMC Vehicles has no effect on the direction of Weihai Honglin i.e., Weihai Honglin and CIMC Vehicles go up and down completely randomly.
Pair Corralation between Weihai Honglin and CIMC Vehicles
Assuming the 90 days trading horizon Weihai Honglin Electronic is expected to under-perform the CIMC Vehicles. In addition to that, Weihai Honglin is 1.04 times more volatile than CIMC Vehicles Co. It trades about -0.03 of its total potential returns per unit of risk. CIMC Vehicles Co is currently generating about 0.03 per unit of volatility. If you would invest 761.00 in CIMC Vehicles Co on September 12, 2024 and sell it today you would earn a total of 226.00 from holding CIMC Vehicles Co or generate 29.7% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 88.45% |
| Values | Daily Returns |
Weihai Honglin Electronic vs. CIMC Vehicles Co
Performance |
| Timeline |
| Weihai Honglin Electronic |
| CIMC Vehicles |
Weihai Honglin and CIMC Vehicles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Weihai Honglin and CIMC Vehicles
The main advantage of trading using opposite Weihai Honglin and CIMC Vehicles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Weihai Honglin position performs unexpectedly, CIMC Vehicles 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 CIMC Vehicles will offset losses from the drop in CIMC Vehicles' long position.| Weihai Honglin vs. Agricultural Bank of | Weihai Honglin vs. Industrial and Commercial | Weihai Honglin vs. Bank of China | Weihai Honglin vs. PetroChina Co Ltd |
| CIMC Vehicles vs. Agricultural Bank of | CIMC Vehicles vs. Industrial and Commercial | CIMC Vehicles vs. Bank of China | CIMC Vehicles vs. PetroChina Co Ltd |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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