Correlation Between Dongfeng Automobile and Invengo Information
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By analyzing existing cross correlation between Dongfeng Automobile Co and Invengo Information Technology, you can compare the effects of market volatilities on Dongfeng Automobile and Invengo Information 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 Invengo Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongfeng Automobile and Invengo Information.
Diversification Opportunities for Dongfeng Automobile and Invengo Information
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dongfeng and Invengo is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Dongfeng Automobile Co and Invengo Information Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invengo Information 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 Invengo Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invengo Information has no effect on the direction of Dongfeng Automobile i.e., Dongfeng Automobile and Invengo Information go up and down completely randomly.
Pair Corralation between Dongfeng Automobile and Invengo Information
Assuming the 90 days trading horizon Dongfeng Automobile is expected to generate 1.63 times less return on investment than Invengo Information. But when comparing it to its historical volatility, Dongfeng Automobile Co is 1.26 times less risky than Invengo Information. It trades about 0.17 of its potential returns per unit of risk. Invengo Information Technology is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 394.00 in Invengo Information Technology on September 12, 2024 and sell it today you would earn a total of 259.00 from holding Invengo Information Technology or generate 65.74% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongfeng Automobile Co vs. Invengo Information Technology
Performance |
| Timeline |
| Dongfeng Automobile |
| Invengo Information |
Dongfeng Automobile and Invengo Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongfeng Automobile and Invengo Information
The main advantage of trading using opposite Dongfeng Automobile and Invengo Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongfeng Automobile position performs unexpectedly, Invengo Information 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 Invengo Information will offset losses from the drop in Invengo Information's long position.| Dongfeng Automobile vs. Guosheng Financial Holding | Dongfeng Automobile vs. Peoples Insurance of | Dongfeng Automobile vs. Zhongrun Resources Investment | Dongfeng Automobile vs. Shenwu Energy Saving |
| Invengo Information vs. Industrial and Commercial | Invengo Information vs. Agricultural Bank of | Invengo Information vs. China Construction Bank | Invengo Information vs. Bank of China |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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