Correlation Between Changchun Faway and 516220
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By analyzing existing cross correlation between Changchun Faway Automobile and 516220, you can compare the effects of market volatilities on Changchun Faway and 516220 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 516220. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun Faway and 516220.
Diversification Opportunities for Changchun Faway and 516220
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Changchun and 516220 is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Changchun Faway Automobile and 516220 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on 516220 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 516220. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of 516220 has no effect on the direction of Changchun Faway i.e., Changchun Faway and 516220 go up and down completely randomly.
Pair Corralation between Changchun Faway and 516220
Assuming the 90 days trading horizon Changchun Faway Automobile is expected to generate 0.9 times more return on investment than 516220. However, Changchun Faway Automobile is 1.11 times less risky than 516220. It trades about 0.22 of its potential returns per unit of risk. 516220 is currently generating about 0.12 per unit of risk. If you would invest 730.00 in Changchun Faway Automobile on August 28, 2024 and sell it today you would earn a total of 238.00 from holding Changchun Faway Automobile or generate 32.6% 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. 516220
Performance |
| Timeline |
| Changchun Faway Auto |
| 516220 |
Changchun Faway and 516220 Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun Faway and 516220
The main advantage of trading using opposite Changchun Faway and 516220 positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun Faway position performs unexpectedly, 516220 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 516220 will offset losses from the drop in 516220's long position.| Changchun Faway vs. Chinese Universe Publishing | Changchun Faway vs. Ningbo Jianan Electronics | Changchun Faway vs. Epoxy Base Electronic | Changchun Faway vs. Changjiang Publishing Media |
| 516220 vs. Shenzhen MTC Co | 516220 vs. Ming Yang Smart | 516220 vs. Changzhou Almaden Co | 516220 vs. 159005 |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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