Correlation Between Cango and Camping World
Can any of the company-specific risk be diversified away by investing in both Cango and Camping World 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 Cango and Camping World into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cango Inc and Camping World Holdings, you can compare the effects of market volatilities on Cango and Camping World 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 Cango with a short position of Camping World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cango and Camping World.
Diversification Opportunities for Cango and Camping World
-0.32 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cango and Camping is -0.32. Overlapping area represents the amount of risk that can be diversified away by holding Cango Inc and Camping World Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Camping World Holdings and Cango 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 Cango Inc are associated (or correlated) with Camping World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Camping World Holdings has no effect on the direction of Cango i.e., Cango and Camping World go up and down completely randomly.
Pair Corralation between Cango and Camping World
Given the investment horizon of 90 days Cango Inc is expected to generate 3.36 times more return on investment than Camping World. However, Cango is 3.36 times more volatile than Camping World Holdings. It trades about 0.14 of its potential returns per unit of risk. Camping World Holdings is currently generating about 0.11 per unit of risk. If you would invest 285.00 in Cango Inc on November 1, 2024 and sell it today you would earn a total of 202.00 from holding Cango Inc or generate 70.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cango Inc vs. Camping World Holdings
Performance |
| Timeline |
| Cango Inc |
| Camping World Holdings |
Cango and Camping World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cango and Camping World
The main advantage of trading using opposite Cango and Camping World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cango position performs unexpectedly, Camping World 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 Camping World will offset losses from the drop in Camping World's long position.| Cango vs. Cars Inc | Cango vs. KAR Auction Services | Cango vs. Rush Enterprises B | Cango vs. Rush Enterprises A |
| Camping World vs. Group 1 Automotive | Camping World vs. Sonic Automotive | Camping World vs. Penske Automotive Group | Camping World vs. Lithia Motors |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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