Correlation Between ButOne Information and Dongfeng Automobile
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By analyzing existing cross correlation between ButOne Information Corp and Dongfeng Automobile Co, you can compare the effects of market volatilities on ButOne Information and Dongfeng Automobile 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 ButOne Information with a short position of Dongfeng Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of ButOne Information and Dongfeng Automobile.
Diversification Opportunities for ButOne Information and Dongfeng Automobile
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ButOne and Dongfeng is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding ButOne Information Corp and Dongfeng Automobile Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongfeng Automobile and ButOne Information 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 ButOne Information Corp are associated (or correlated) with Dongfeng Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongfeng Automobile has no effect on the direction of ButOne Information i.e., ButOne Information and Dongfeng Automobile go up and down completely randomly.
Pair Corralation between ButOne Information and Dongfeng Automobile
Assuming the 90 days trading horizon ButOne Information is expected to generate 1.44 times less return on investment than Dongfeng Automobile. In addition to that, ButOne Information is 1.02 times more volatile than Dongfeng Automobile Co. It trades about 0.02 of its total potential returns per unit of risk. Dongfeng Automobile Co is currently generating about 0.03 per unit of volatility. If you would invest 621.00 in Dongfeng Automobile Co on August 30, 2024 and sell it today you would earn a total of 104.00 from holding Dongfeng Automobile Co or generate 16.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ButOne Information Corp vs. Dongfeng Automobile Co
Performance |
| Timeline |
| ButOne Information Corp |
| Dongfeng Automobile |
ButOne Information and Dongfeng Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ButOne Information and Dongfeng Automobile
The main advantage of trading using opposite ButOne Information and Dongfeng Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ButOne Information position performs unexpectedly, Dongfeng Automobile 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 Dongfeng Automobile will offset losses from the drop in Dongfeng Automobile's long position.| ButOne Information vs. Agricultural Bank of | ButOne Information vs. Industrial and Commercial | ButOne Information vs. Bank of China | ButOne Information vs. China Construction Bank |
| Dongfeng Automobile vs. Zhengzhou Qianweiyangchu Food | Dongfeng Automobile vs. Impulse Qingdao Health | Dongfeng Automobile vs. Yankershop Food Co | Dongfeng Automobile vs. Healthcare 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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