Correlation Between Datang International and QUICKSTEP HLDGS
Can any of the company-specific risk be diversified away by investing in both Datang International and QUICKSTEP HLDGS 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 Datang International and QUICKSTEP HLDGS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Datang International Power and QUICKSTEP HLDGS, you can compare the effects of market volatilities on Datang International and QUICKSTEP HLDGS 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 Datang International with a short position of QUICKSTEP HLDGS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Datang International and QUICKSTEP HLDGS.
Diversification Opportunities for Datang International and QUICKSTEP HLDGS
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Datang and QUICKSTEP is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding Datang International Power and QUICKSTEP HLDGS in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on QUICKSTEP HLDGS and Datang International 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 Datang International Power are associated (or correlated) with QUICKSTEP HLDGS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of QUICKSTEP HLDGS has no effect on the direction of Datang International i.e., Datang International and QUICKSTEP HLDGS go up and down completely randomly.
Pair Corralation between Datang International and QUICKSTEP HLDGS
Assuming the 90 days horizon Datang International is expected to generate 52.25 times less return on investment than QUICKSTEP HLDGS. But when comparing it to its historical volatility, Datang International Power is 3.16 times less risky than QUICKSTEP HLDGS. It trades about 0.01 of its potential returns per unit of risk. QUICKSTEP HLDGS is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 11.00 in QUICKSTEP HLDGS on September 3, 2024 and sell it today you would earn a total of 11.00 from holding QUICKSTEP HLDGS or generate 100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Datang International Power vs. QUICKSTEP HLDGS
Performance |
| Timeline |
| Datang International |
| QUICKSTEP HLDGS |
Datang International and QUICKSTEP HLDGS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Datang International and QUICKSTEP HLDGS
The main advantage of trading using opposite Datang International and QUICKSTEP HLDGS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Datang International position performs unexpectedly, QUICKSTEP HLDGS 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 QUICKSTEP HLDGS will offset losses from the drop in QUICKSTEP HLDGS's long position.| Datang International vs. CENTRICA ADR NEW | Datang International vs. Superior Plus Corp | Datang International vs. NMI Holdings | Datang International vs. Origin Agritech |
| QUICKSTEP HLDGS vs. Data3 Limited | QUICKSTEP HLDGS vs. Information Services International Dentsu | QUICKSTEP HLDGS vs. INFORMATION SVC GRP | QUICKSTEP HLDGS vs. Datang International Power |
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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