Correlation Between Senmiao Technology and Empresa Distribuidora
Can any of the company-specific risk be diversified away by investing in both Senmiao Technology and Empresa Distribuidora at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Senmiao Technology and Empresa Distribuidora into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Senmiao Technology and Empresa Distribuidora y, you can compare the effects of market volatilities on Senmiao Technology and Empresa Distribuidora 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 Senmiao Technology with a short position of Empresa Distribuidora. Check out your portfolio center. Please also check ongoing floating volatility patterns of Senmiao Technology and Empresa Distribuidora.
Diversification Opportunities for Senmiao Technology and Empresa Distribuidora
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Senmiao and Empresa is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding Senmiao Technology and Empresa Distribuidora y in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Empresa Distribuidora and Senmiao Technology 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 Senmiao Technology are associated (or correlated) with Empresa Distribuidora. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Empresa Distribuidora has no effect on the direction of Senmiao Technology i.e., Senmiao Technology and Empresa Distribuidora go up and down completely randomly.
Pair Corralation between Senmiao Technology and Empresa Distribuidora
Given the investment horizon of 90 days Senmiao Technology is expected to generate 0.81 times more return on investment than Empresa Distribuidora. However, Senmiao Technology is 1.24 times less risky than Empresa Distribuidora. It trades about 0.21 of its potential returns per unit of risk. Empresa Distribuidora y is currently generating about -0.03 per unit of risk. If you would invest 91.00 in Senmiao Technology on October 7, 2024 and sell it today you would earn a total of 12.00 from holding Senmiao Technology or generate 13.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Senmiao Technology vs. Empresa Distribuidora y
Performance |
| Timeline |
| Senmiao Technology |
| Empresa Distribuidora |
Senmiao Technology and Empresa Distribuidora Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Senmiao Technology and Empresa Distribuidora
The main advantage of trading using opposite Senmiao Technology and Empresa Distribuidora positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Senmiao Technology position performs unexpectedly, Empresa Distribuidora 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 Empresa Distribuidora will offset losses from the drop in Empresa Distribuidora's long position.| Senmiao Technology vs. X Financial Class | Senmiao Technology vs. Yirendai | Senmiao Technology vs. Pintec Technology Holdings | Senmiao Technology vs. Qudian Inc |
| Empresa Distribuidora vs. Centrais Electricas Brasileiras | Empresa Distribuidora vs. Enel Chile SA | Empresa Distribuidora vs. Korea Electric Power | Empresa Distribuidora vs. Genie Energy |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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