Correlation Between CNVISION MEDIA and Zhejiang Expressway
Can any of the company-specific risk be diversified away by investing in both CNVISION MEDIA and Zhejiang Expressway 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 CNVISION MEDIA and Zhejiang Expressway into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CNVISION MEDIA and Zhejiang Expressway Co, you can compare the effects of market volatilities on CNVISION MEDIA and Zhejiang Expressway 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 CNVISION MEDIA with a short position of Zhejiang Expressway. Check out your portfolio center. Please also check ongoing floating volatility patterns of CNVISION MEDIA and Zhejiang Expressway.
Diversification Opportunities for CNVISION MEDIA and Zhejiang Expressway
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between CNVISION and Zhejiang is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding CNVISION MEDIA and Zhejiang Expressway Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Expressway and CNVISION MEDIA 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 CNVISION MEDIA are associated (or correlated) with Zhejiang Expressway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Expressway has no effect on the direction of CNVISION MEDIA i.e., CNVISION MEDIA and Zhejiang Expressway go up and down completely randomly.
Pair Corralation between CNVISION MEDIA and Zhejiang Expressway
Assuming the 90 days trading horizon CNVISION MEDIA is expected to under-perform the Zhejiang Expressway. But the stock apears to be less risky and, when comparing its historical volatility, CNVISION MEDIA is 2.53 times less risky than Zhejiang Expressway. The stock trades about 0.0 of its potential returns per unit of risk. The Zhejiang Expressway Co is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 13.00 in Zhejiang Expressway Co on September 4, 2024 and sell it today you would earn a total of 49.00 from holding Zhejiang Expressway Co or generate 376.92% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CNVISION MEDIA vs. Zhejiang Expressway Co
Performance |
| Timeline |
| CNVISION MEDIA |
| Zhejiang Expressway |
CNVISION MEDIA and Zhejiang Expressway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CNVISION MEDIA and Zhejiang Expressway
The main advantage of trading using opposite CNVISION MEDIA and Zhejiang Expressway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CNVISION MEDIA position performs unexpectedly, Zhejiang Expressway 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 Zhejiang Expressway will offset losses from the drop in Zhejiang Expressway's long position.| CNVISION MEDIA vs. TOTAL GABON | CNVISION MEDIA vs. Walgreens Boots Alliance | CNVISION MEDIA vs. Peak Resources Limited |
| Zhejiang Expressway vs. CNVISION MEDIA | Zhejiang Expressway vs. LION ONE METALS | Zhejiang Expressway vs. RCS MediaGroup SpA | Zhejiang Expressway vs. XLMedia PLC |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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