Correlation Between Caihong Display and CIMC Vehicles
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By analyzing existing cross correlation between Caihong Display Devices and CIMC Vehicles Co, you can compare the effects of market volatilities on Caihong Display 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 Caihong Display with a short position of CIMC Vehicles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caihong Display and CIMC Vehicles.
Diversification Opportunities for Caihong Display and CIMC Vehicles
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Caihong and CIMC is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Caihong Display Devices and CIMC Vehicles Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIMC Vehicles and Caihong Display 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 Caihong Display Devices 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 Caihong Display i.e., Caihong Display and CIMC Vehicles go up and down completely randomly.
Pair Corralation between Caihong Display and CIMC Vehicles
Assuming the 90 days trading horizon Caihong Display is expected to generate 1.94 times less return on investment than CIMC Vehicles. But when comparing it to its historical volatility, Caihong Display Devices is 1.09 times less risky than CIMC Vehicles. It trades about 0.05 of its potential returns per unit of risk. CIMC Vehicles Co is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 855.00 in CIMC Vehicles Co on September 2, 2024 and sell it today you would earn a total of 131.00 from holding CIMC Vehicles Co or generate 15.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Caihong Display Devices vs. CIMC Vehicles Co
Performance |
| Timeline |
| Caihong Display Devices |
| CIMC Vehicles |
Caihong Display and CIMC Vehicles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caihong Display and CIMC Vehicles
The main advantage of trading using opposite Caihong Display and CIMC Vehicles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caihong Display 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.| Caihong Display vs. Cultural Investment Holdings | Caihong Display vs. Gome Telecom Equipment | Caihong Display vs. Bus Online Co | Caihong Display vs. Zotye Automobile Co |
| CIMC Vehicles vs. Kweichow Moutai Co | CIMC Vehicles vs. NAURA Technology Group | CIMC Vehicles vs. Zhejiang Orient Gene | CIMC Vehicles vs. APT Medical |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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