Correlation Between Cheche Group and Trump Media
Can any of the company-specific risk be diversified away by investing in both Cheche Group and Trump Media 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 Cheche Group and Trump Media into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cheche Group Class and Trump Media Technology, you can compare the effects of market volatilities on Cheche Group and Trump Media 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 Cheche Group with a short position of Trump Media. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cheche Group and Trump Media.
Diversification Opportunities for Cheche Group and Trump Media
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Cheche and Trump is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Cheche Group Class and Trump Media Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Trump Media Technology and Cheche Group 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 Cheche Group Class are associated (or correlated) with Trump Media. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Trump Media Technology has no effect on the direction of Cheche Group i.e., Cheche Group and Trump Media go up and down completely randomly.
Pair Corralation between Cheche Group and Trump Media
Considering the 90-day investment horizon Cheche Group is expected to generate 5.01 times less return on investment than Trump Media. But when comparing it to its historical volatility, Cheche Group Class is 1.93 times less risky than Trump Media. It trades about 0.06 of its potential returns per unit of risk. Trump Media Technology is currently generating about 0.14 of returns per unit of risk over similar time horizon. If you would invest 3,523 in Trump Media Technology on October 24, 2024 and sell it today you would earn a total of 480.00 from holding Trump Media Technology or generate 13.62% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cheche Group Class vs. Trump Media Technology
Performance |
| Timeline |
| Cheche Group Class |
| Trump Media Technology |
Cheche Group and Trump Media Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cheche Group and Trump Media
The main advantage of trading using opposite Cheche Group and Trump Media positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cheche Group position performs unexpectedly, Trump Media 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 Trump Media will offset losses from the drop in Trump Media's long position.| Cheche Group vs. Albertsons Companies | Cheche Group vs. Tradeweb Markets | Cheche Group vs. Academy Sports Outdoors | Cheche Group vs. BBB Foods |
| Trump Media vs. CECO Environmental Corp | Trump Media vs. Tritent International Agriculture | Trump Media vs. Tyson Foods | Trump Media vs. Avient Corp |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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