Correlation Between CBAK Energy and Pioneer Power
Can any of the company-specific risk be diversified away by investing in both CBAK Energy and Pioneer 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 Pioneer 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 Pioneer Power Solutions, you can compare the effects of market volatilities on CBAK Energy and Pioneer 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 Pioneer Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBAK Energy and Pioneer Power.
Diversification Opportunities for CBAK Energy and Pioneer Power
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between CBAK and Pioneer is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding CBAK Energy Technology and Pioneer Power Solutions in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pioneer Power Solutions 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 Pioneer Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pioneer Power Solutions has no effect on the direction of CBAK Energy i.e., CBAK Energy and Pioneer Power go up and down completely randomly.
Pair Corralation between CBAK Energy and Pioneer Power
Given the investment horizon of 90 days CBAK Energy Technology is expected to under-perform the Pioneer Power. In addition to that, CBAK Energy is 1.3 times more volatile than Pioneer Power Solutions. It trades about 0.0 of its total potential returns per unit of risk. Pioneer Power Solutions is currently generating about 0.06 per unit of volatility. If you would invest 317.00 in Pioneer Power Solutions on November 2, 2024 and sell it today you would earn a total of 54.00 from holding Pioneer Power Solutions or generate 17.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CBAK Energy Technology vs. Pioneer Power Solutions
Performance |
| Timeline |
| CBAK Energy Technology |
| Pioneer Power Solutions |
CBAK Energy and Pioneer Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CBAK Energy and Pioneer Power
The main advantage of trading using opposite CBAK Energy and Pioneer Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBAK Energy position performs unexpectedly, Pioneer 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 Pioneer Power will offset losses from the drop in Pioneer 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 |
| Pioneer Power vs. CBAK Energy Technology | Pioneer Power vs. Ocean Power Technologies | Pioneer Power vs. Ideal Power | Pioneer Power vs. Expion360 |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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