Correlation Between Datang International and CVW CLEANTECH
Can any of the company-specific risk be diversified away by investing in both Datang International and CVW CLEANTECH 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 CVW CLEANTECH 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 CVW CLEANTECH INC, you can compare the effects of market volatilities on Datang International and CVW CLEANTECH 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 CVW CLEANTECH. Check out your portfolio center. Please also check ongoing floating volatility patterns of Datang International and CVW CLEANTECH.
Diversification Opportunities for Datang International and CVW CLEANTECH
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Datang and CVW is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Datang International Power and CVW CLEANTECH INC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CVW CLEANTECH INC 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 CVW CLEANTECH. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CVW CLEANTECH INC has no effect on the direction of Datang International i.e., Datang International and CVW CLEANTECH go up and down completely randomly.
Pair Corralation between Datang International and CVW CLEANTECH
Assuming the 90 days horizon Datang International Power is expected to under-perform the CVW CLEANTECH. But the stock apears to be less risky and, when comparing its historical volatility, Datang International Power is 1.16 times less risky than CVW CLEANTECH. The stock trades about -0.02 of its potential returns per unit of risk. The CVW CLEANTECH INC is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 53.00 in CVW CLEANTECH INC on August 31, 2024 and sell it today you would earn a total of 3.00 from holding CVW CLEANTECH INC or generate 5.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Datang International Power vs. CVW CLEANTECH INC
Performance |
| Timeline |
| Datang International |
| CVW CLEANTECH INC |
Datang International and CVW CLEANTECH Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Datang International and CVW CLEANTECH
The main advantage of trading using opposite Datang International and CVW CLEANTECH positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Datang International position performs unexpectedly, CVW CLEANTECH 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 CVW CLEANTECH will offset losses from the drop in CVW CLEANTECH's long position.| Datang International vs. CENTRICA ADR NEW | Datang International vs. TransAlta | Datang International vs. Superior Plus Corp | Datang International vs. NMI Holdings |
| CVW CLEANTECH vs. Rio Tinto Group | CVW CLEANTECH vs. Liontown Resources Limited | CVW CLEANTECH vs. American Lithium Corp |
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 CEOs Directory module to screen CEOs from public companies around the world.
Other Complementary Tools
| Fundamental Analysis View fundamental data based on most recent published financial statements | |
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Bonds Directory Find actively traded corporate debentures issued by US companies |