Correlation Between Dongfeng Automobile and China Securities
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By analyzing existing cross correlation between Dongfeng Automobile Co and China Securities 800, you can compare the effects of market volatilities on Dongfeng Automobile and China Securities 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 Dongfeng Automobile with a short position of China Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongfeng Automobile and China Securities.
Diversification Opportunities for Dongfeng Automobile and China Securities
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dongfeng and China is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Dongfeng Automobile Co and China Securities 800 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Securities 800 and Dongfeng Automobile 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 Dongfeng Automobile Co are associated (or correlated) with China Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Securities 800 has no effect on the direction of Dongfeng Automobile i.e., Dongfeng Automobile and China Securities go up and down completely randomly.
Pair Corralation between Dongfeng Automobile and China Securities
Assuming the 90 days trading horizon Dongfeng Automobile Co is expected to generate 2.47 times more return on investment than China Securities. However, Dongfeng Automobile is 2.47 times more volatile than China Securities 800. It trades about 0.02 of its potential returns per unit of risk. China Securities 800 is currently generating about -0.02 per unit of risk. If you would invest 591.00 in Dongfeng Automobile Co on October 14, 2024 and sell it today you would earn a total of 66.00 from holding Dongfeng Automobile Co or generate 11.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongfeng Automobile Co vs. China Securities 800
Performance |
| Timeline |
Dongfeng Automobile and China Securities Volatility Contrast
Predicted Return Density |
| Returns |
Dongfeng Automobile Co
Pair trading matchups for Dongfeng Automobile
China Securities 800
Pair trading matchups for China Securities
Pair Trading with Dongfeng Automobile and China Securities
The main advantage of trading using opposite Dongfeng Automobile and China Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongfeng Automobile position performs unexpectedly, China Securities 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 China Securities will offset losses from the drop in China Securities' long position.| Dongfeng Automobile vs. Jiangsu Yueda Investment | Dongfeng Automobile vs. Hunan Mendale Hometextile | Dongfeng Automobile vs. Zoy Home Furnishing | Dongfeng Automobile vs. Markor International Home |
| China Securities vs. Sunwave Communications Co | China Securities vs. Dongfeng Automobile Co | China Securities vs. Nanjing Vishee Medical | China Securities vs. Haima Automobile Group |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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