Correlation Between CBAK Energy and Polar Power
Can any of the company-specific risk be diversified away by investing in both CBAK Energy and Polar Power 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 Polar Power 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 Polar Power, you can compare the effects of market volatilities on CBAK Energy and Polar Power 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 Polar Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBAK Energy and Polar Power.
Diversification Opportunities for CBAK Energy and Polar Power
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CBAK and Polar is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding CBAK Energy Technology and Polar Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Polar Power 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 Polar Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Polar Power has no effect on the direction of CBAK Energy i.e., CBAK Energy and Polar Power go up and down completely randomly.
Pair Corralation between CBAK Energy and Polar Power
Given the investment horizon of 90 days CBAK Energy Technology is expected to generate 0.98 times more return on investment than Polar Power. However, CBAK Energy Technology is 1.02 times less risky than Polar Power. It trades about -0.16 of its potential returns per unit of risk. Polar Power is currently generating about -0.31 per unit of risk. If you would invest 101.00 in CBAK Energy Technology on November 2, 2024 and sell it today you would lose (9.00) from holding CBAK Energy Technology or give up 8.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CBAK Energy Technology vs. Polar Power
Performance |
| Timeline |
| CBAK Energy Technology |
| Polar Power |
CBAK Energy and Polar Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CBAK Energy and Polar Power
The main advantage of trading using opposite CBAK Energy and Polar Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBAK Energy position performs unexpectedly, Polar Power 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 Polar Power will offset losses from the drop in Polar Power's long position.| CBAK Energy vs. Pioneer Power Solutions | CBAK Energy vs. Ocean Power Technologies | CBAK Energy vs. Ideal Power | CBAK Energy vs. Expion360 |
| Polar Power vs. CBAK Energy Technology | Polar Power vs. Ocean Power Technologies | Polar Power vs. Enersys | Polar Power vs. Flux Power Holdings |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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