Correlation Between Cambricon Technologies and Road Environment
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By analyzing existing cross correlation between Cambricon Technologies Corp and Road Environment Technology, you can compare the effects of market volatilities on Cambricon Technologies and Road Environment 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 Cambricon Technologies with a short position of Road Environment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cambricon Technologies and Road Environment.
Diversification Opportunities for Cambricon Technologies and Road Environment
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Cambricon and Road is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Cambricon Technologies Corp and Road Environment Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Road Environment Tec and Cambricon Technologies 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 Cambricon Technologies Corp are associated (or correlated) with Road Environment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Road Environment Tec has no effect on the direction of Cambricon Technologies i.e., Cambricon Technologies and Road Environment go up and down completely randomly.
Pair Corralation between Cambricon Technologies and Road Environment
Assuming the 90 days trading horizon Cambricon Technologies Corp is expected to generate 1.56 times more return on investment than Road Environment. However, Cambricon Technologies is 1.56 times more volatile than Road Environment Technology. It trades about 0.17 of its potential returns per unit of risk. Road Environment Technology is currently generating about 0.0 per unit of risk. If you would invest 42,520 in Cambricon Technologies Corp on August 25, 2024 and sell it today you would earn a total of 6,680 from holding Cambricon Technologies Corp or generate 15.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Cambricon Technologies Corp vs. Road Environment Technology
Performance |
| Timeline |
| Cambricon Technologies |
| Road Environment Tec |
Cambricon Technologies and Road Environment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cambricon Technologies and Road Environment
The main advantage of trading using opposite Cambricon Technologies and Road Environment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cambricon Technologies position performs unexpectedly, Road Environment 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 Road Environment will offset losses from the drop in Road Environment's long position.| Cambricon Technologies vs. Dymatic Chemicals | Cambricon Technologies vs. Jiangsu Financial Leasing | Cambricon Technologies vs. Guangzhou Jointas Chemical | Cambricon Technologies vs. Chengtun Mining Group |
| Road Environment vs. Cambricon Technologies Corp | Road Environment vs. Loongson Technology Corp | Road Environment vs. Chongqing Road Bridge | Road Environment vs. Shenzhen Fortune Trend |
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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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