Correlation Between China Clean and Stepstone
Can any of the company-specific risk be diversified away by investing in both China Clean and Stepstone 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 China Clean and Stepstone into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Clean Energy and Stepstone Group, you can compare the effects of market volatilities on China Clean and Stepstone 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 China Clean with a short position of Stepstone. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Clean and Stepstone.
Diversification Opportunities for China Clean and Stepstone
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between China and Stepstone is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding China Clean Energy and Stepstone Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stepstone Group and China Clean 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 China Clean Energy are associated (or correlated) with Stepstone. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stepstone Group has no effect on the direction of China Clean i.e., China Clean and Stepstone go up and down completely randomly.
Pair Corralation between China Clean and Stepstone
If you would invest 6,131 in Stepstone Group on August 31, 2024 and sell it today you would earn a total of 473.00 from holding Stepstone Group or generate 7.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Clean Energy vs. Stepstone Group
Performance |
| Timeline |
| China Clean Energy |
| Stepstone Group |
China Clean and Stepstone Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Clean and Stepstone
The main advantage of trading using opposite China Clean and Stepstone positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Clean position performs unexpectedly, Stepstone 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 Stepstone will offset losses from the drop in Stepstone's long position.| China Clean vs. Sherwin Williams Co | China Clean vs. Air Liquide SA | China Clean vs. LAir Liquide SA | China Clean vs. Air Products and |
| Stepstone vs. Munivest Fund | Stepstone vs. Blackrock Muniyield Quality | Stepstone vs. Federated Investors B | Stepstone vs. Federated Premier Municipal |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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