Correlation Between China Dongsheng and Ignyte Acquisition
Can any of the company-specific risk be diversified away by investing in both China Dongsheng and Ignyte Acquisition 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 Dongsheng and Ignyte Acquisition into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Dongsheng International and Ignyte Acquisition Corp, you can compare the effects of market volatilities on China Dongsheng and Ignyte Acquisition 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 Dongsheng with a short position of Ignyte Acquisition. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Dongsheng and Ignyte Acquisition.
Diversification Opportunities for China Dongsheng and Ignyte Acquisition
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between China and Ignyte is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding China Dongsheng International and Ignyte Acquisition Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ignyte Acquisition Corp and China Dongsheng 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 Dongsheng International are associated (or correlated) with Ignyte Acquisition. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ignyte Acquisition Corp has no effect on the direction of China Dongsheng i.e., China Dongsheng and Ignyte Acquisition go up and down completely randomly.
Pair Corralation between China Dongsheng and Ignyte Acquisition
If you would invest 0.16 in China Dongsheng International on November 3, 2024 and sell it today you would earn a total of 0.02 from holding China Dongsheng International or generate 12.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 4.76% |
| Values | Daily Returns |
China Dongsheng International vs. Ignyte Acquisition Corp
Performance |
| Timeline |
| China Dongsheng Inte |
| Ignyte Acquisition Corp |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
China Dongsheng and Ignyte Acquisition Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Dongsheng and Ignyte Acquisition
The main advantage of trading using opposite China Dongsheng and Ignyte Acquisition positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Dongsheng position performs unexpectedly, Ignyte Acquisition 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 Ignyte Acquisition will offset losses from the drop in Ignyte Acquisition's long position.| China Dongsheng vs. C2E Energy | China Dongsheng vs. Tanke Biosciences | China Dongsheng vs. Supurva Healthcare Group | China Dongsheng vs. Kasten Inc |
| Ignyte Acquisition vs. Akeso, Inc | Ignyte Acquisition vs. Innovation1 Biotech | Ignyte Acquisition vs. Ascletis Pharma | Ignyte Acquisition vs. Avax Techs |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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