Correlation Between Chindata Group and GDS Holdings
Can any of the company-specific risk be diversified away by investing in both Chindata Group and GDS Holdings 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 Chindata Group and GDS Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chindata Group Holdings and GDS Holdings, you can compare the effects of market volatilities on Chindata Group and GDS Holdings 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 Chindata Group with a short position of GDS Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chindata Group and GDS Holdings.
Diversification Opportunities for Chindata Group and GDS Holdings
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Chindata and GDS is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Chindata Group Holdings and GDS Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GDS Holdings and Chindata 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 Chindata Group Holdings are associated (or correlated) with GDS Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GDS Holdings has no effect on the direction of Chindata Group i.e., Chindata Group and GDS Holdings go up and down completely randomly.
Pair Corralation between Chindata Group and GDS Holdings
If you would invest 1,079 in GDS Holdings on August 24, 2024 and sell it today you would earn a total of 761.00 from holding GDS Holdings or generate 70.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 0.4% |
| Values | Daily Returns |
Chindata Group Holdings vs. GDS Holdings
Performance |
| Timeline |
| Chindata Group Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| GDS Holdings |
Chindata Group and GDS Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chindata Group and GDS Holdings
The main advantage of trading using opposite Chindata Group and GDS Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chindata Group position performs unexpectedly, GDS Holdings 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 GDS Holdings will offset losses from the drop in GDS Holdings' long position.| Chindata Group vs. GDS Holdings | Chindata Group vs. ExlService Holdings | Chindata Group vs. Gartner | Chindata Group vs. VNET Group DRC |
| GDS Holdings vs. ExlService Holdings | GDS Holdings vs. Gartner | GDS Holdings vs. VNET Group DRC | GDS Holdings vs. CLARIVATE 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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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