Correlation Between Changchun Faway and Wonders Information
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By analyzing existing cross correlation between Changchun Faway Automobile and Wonders Information, you can compare the effects of market volatilities on Changchun Faway and Wonders 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 Changchun Faway with a short position of Wonders Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun Faway and Wonders Information.
Diversification Opportunities for Changchun Faway and Wonders Information
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Changchun and Wonders is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Changchun Faway Automobile and Wonders Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wonders Information and Changchun Faway 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 Changchun Faway Automobile are associated (or correlated) with Wonders Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wonders Information has no effect on the direction of Changchun Faway i.e., Changchun Faway and Wonders Information go up and down completely randomly.
Pair Corralation between Changchun Faway and Wonders Information
Assuming the 90 days trading horizon Changchun Faway is expected to generate 4.75 times less return on investment than Wonders Information. But when comparing it to its historical volatility, Changchun Faway Automobile is 2.53 times less risky than Wonders Information. It trades about 0.06 of its potential returns per unit of risk. Wonders Information is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 523.00 in Wonders Information on September 2, 2024 and sell it today you would earn a total of 435.00 from holding Wonders Information or generate 83.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun Faway Automobile vs. Wonders Information
Performance |
| Timeline |
| Changchun Faway Auto |
| Wonders Information |
Changchun Faway and Wonders Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun Faway and Wonders Information
The main advantage of trading using opposite Changchun Faway and Wonders Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun Faway position performs unexpectedly, Wonders 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 Wonders Information will offset losses from the drop in Wonders Information's long position.| Changchun Faway vs. Sichuan Yahua Industrial | Changchun Faway vs. Longmaster Information Tech | Changchun Faway vs. ButOne Information Corp | Changchun Faway vs. Shenzhen Shenbao Industrial |
| Wonders Information vs. China Petroleum Chemical | Wonders Information vs. PetroChina Co Ltd | Wonders Information vs. China State Construction | Wonders Information vs. China Railway 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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