Correlation Between CBAK Energy and NeoVolta Warrant
Can any of the company-specific risk be diversified away by investing in both CBAK Energy and NeoVolta Warrant 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 CBAK Energy and NeoVolta Warrant into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CBAK Energy Technology and NeoVolta Warrant, you can compare the effects of market volatilities on CBAK Energy and NeoVolta Warrant 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 CBAK Energy with a short position of NeoVolta Warrant. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBAK Energy and NeoVolta Warrant.
Diversification Opportunities for CBAK Energy and NeoVolta Warrant
-0.34 | Correlation Coefficient |
Very good diversification
The 3 months correlation between CBAK and NeoVolta is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding CBAK Energy Technology and NeoVolta Warrant in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on NeoVolta Warrant and CBAK Energy 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 CBAK Energy Technology are associated (or correlated) with NeoVolta Warrant. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of NeoVolta Warrant has no effect on the direction of CBAK Energy i.e., CBAK Energy and NeoVolta Warrant go up and down completely randomly.
Pair Corralation between CBAK Energy and NeoVolta Warrant
Given the investment horizon of 90 days CBAK Energy is expected to generate 394.09 times less return on investment than NeoVolta Warrant. But when comparing it to its historical volatility, CBAK Energy Technology is 22.68 times less risky than NeoVolta Warrant. It trades about 0.01 of its potential returns per unit of risk. NeoVolta Warrant is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 120.00 in NeoVolta Warrant on August 24, 2024 and sell it today you would earn a total of 120.00 from holding NeoVolta Warrant or generate 100.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 69.76% |
| Values | Daily Returns |
CBAK Energy Technology vs. NeoVolta Warrant
Performance |
| Timeline |
| CBAK Energy Technology |
| NeoVolta Warrant |
CBAK Energy and NeoVolta Warrant Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CBAK Energy and NeoVolta Warrant
The main advantage of trading using opposite CBAK Energy and NeoVolta Warrant positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBAK Energy position performs unexpectedly, NeoVolta Warrant 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 NeoVolta Warrant will offset losses from the drop in NeoVolta Warrant's long position.| CBAK Energy vs. Pioneer Power Solutions | CBAK Energy vs. Ocean Power Technologies | CBAK Energy vs. Ideal Power | CBAK Energy vs. Expion360 |
| NeoVolta Warrant vs. Plug Power | NeoVolta Warrant vs. Solid Power | NeoVolta Warrant vs. CBAK Energy Technology | NeoVolta Warrant vs. FuelCell 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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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