Correlation Between Road Environment and Konfoong Materials
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By analyzing existing cross correlation between Road Environment Technology and Konfoong Materials International, you can compare the effects of market volatilities on Road Environment and Konfoong Materials 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 Road Environment with a short position of Konfoong Materials. Check out your portfolio center. Please also check ongoing floating volatility patterns of Road Environment and Konfoong Materials.
Diversification Opportunities for Road Environment and Konfoong Materials
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Road and Konfoong is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Road Environment Technology and Konfoong Materials Internation in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Konfoong Materials and Road Environment 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 Road Environment Technology are associated (or correlated) with Konfoong Materials. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Konfoong Materials has no effect on the direction of Road Environment i.e., Road Environment and Konfoong Materials go up and down completely randomly.
Pair Corralation between Road Environment and Konfoong Materials
Assuming the 90 days trading horizon Road Environment Technology is expected to under-perform the Konfoong Materials. But the stock apears to be less risky and, when comparing its historical volatility, Road Environment Technology is 1.01 times less risky than Konfoong Materials. The stock trades about -0.07 of its potential returns per unit of risk. The Konfoong Materials International is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 6,945 in Konfoong Materials International on November 1, 2024 and sell it today you would earn a total of 84.00 from holding Konfoong Materials International or generate 1.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Road Environment Technology vs. Konfoong Materials Internation
Performance |
| Timeline |
| Road Environment Tec |
| Konfoong Materials |
Road Environment and Konfoong Materials Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Road Environment and Konfoong Materials
The main advantage of trading using opposite Road Environment and Konfoong Materials positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Road Environment position performs unexpectedly, Konfoong Materials 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 Konfoong Materials will offset losses from the drop in Konfoong Materials' long position.| Road Environment vs. Marssenger Kitchenware Co | Road Environment vs. Tangel Publishing | Road Environment vs. Wuhan Hvsen Biotechnology | Road Environment vs. Huatian Hotel Group |
| Konfoong Materials vs. Hainan Mining Co | Konfoong Materials vs. Jinhui Mining Co | Konfoong Materials vs. Road Environment Technology | Konfoong Materials vs. Jiangxi Naipu Mining |
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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