Correlation Between Industrial and Chongqing Department
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By analyzing existing cross correlation between Industrial and Commercial and Chongqing Department Store, you can compare the effects of market volatilities on Industrial and Chongqing Department 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 Industrial with a short position of Chongqing Department. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial and Chongqing Department.
Diversification Opportunities for Industrial and Chongqing Department
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Industrial and Chongqing is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Industrial and Commercial and Chongqing Department Store in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Department and Industrial 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 Industrial and Commercial are associated (or correlated) with Chongqing Department. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chongqing Department has no effect on the direction of Industrial i.e., Industrial and Chongqing Department go up and down completely randomly.
Pair Corralation between Industrial and Chongqing Department
Assuming the 90 days trading horizon Industrial is expected to generate 74.27 times less return on investment than Chongqing Department. But when comparing it to its historical volatility, Industrial and Commercial is 4.46 times less risky than Chongqing Department. It trades about 0.02 of its potential returns per unit of risk. Chongqing Department Store is currently generating about 0.36 of returns per unit of risk over similar time horizon. If you would invest 2,222 in Chongqing Department Store on September 3, 2024 and sell it today you would earn a total of 725.00 from holding Chongqing Department Store or generate 32.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial and Commercial vs. Chongqing Department Store
Performance |
| Timeline |
| Industrial and Commercial |
| Chongqing Department |
Industrial and Chongqing Department Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial and Chongqing Department
The main advantage of trading using opposite Industrial and Chongqing Department positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial position performs unexpectedly, Chongqing Department 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 Chongqing Department will offset losses from the drop in Chongqing Department's long position.| Industrial vs. Tengda Construction Group | Industrial vs. Hongrun Construction Group | Industrial vs. HUAQIN TECHNOLOGY LTD | Industrial vs. Sinomach General Machinery |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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