Correlation Between Chongqing Machinery and Data Modul
Can any of the company-specific risk be diversified away by investing in both Chongqing Machinery and Data Modul 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 Chongqing Machinery and Data Modul into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chongqing Machinery Electric and Data Modul AG, you can compare the effects of market volatilities on Chongqing Machinery and Data Modul 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 Chongqing Machinery with a short position of Data Modul. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Machinery and Data Modul.
Diversification Opportunities for Chongqing Machinery and Data Modul
-0.08 | Correlation Coefficient |
Good diversification
The 3 months correlation between Chongqing and Data is -0.08. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Machinery Electric and Data Modul AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Data Modul AG and Chongqing Machinery 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 Chongqing Machinery Electric are associated (or correlated) with Data Modul. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Data Modul AG has no effect on the direction of Chongqing Machinery i.e., Chongqing Machinery and Data Modul go up and down completely randomly.
Pair Corralation between Chongqing Machinery and Data Modul
Assuming the 90 days horizon Chongqing Machinery Electric is expected to generate 0.85 times more return on investment than Data Modul. However, Chongqing Machinery Electric is 1.17 times less risky than Data Modul. It trades about 0.2 of its potential returns per unit of risk. Data Modul AG is currently generating about -0.05 per unit of risk. If you would invest 7.55 in Chongqing Machinery Electric on October 12, 2024 and sell it today you would earn a total of 0.60 from holding Chongqing Machinery Electric or generate 7.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chongqing Machinery Electric vs. Data Modul AG
Performance |
| Timeline |
| Chongqing Machinery |
| Data Modul AG |
Chongqing Machinery and Data Modul Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chongqing Machinery and Data Modul
The main advantage of trading using opposite Chongqing Machinery and Data Modul positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Machinery position performs unexpectedly, Data Modul 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 Data Modul will offset losses from the drop in Data Modul's long position.| Chongqing Machinery vs. INSURANCE AUST GRP | Chongqing Machinery vs. Fortescue Metals Group | Chongqing Machinery vs. SIERRA METALS | Chongqing Machinery vs. QBE Insurance Group |
| Data Modul vs. Chongqing Machinery Electric | Data Modul vs. Fevertree Drinks PLC | Data Modul vs. Federal Agricultural Mortgage | Data Modul vs. SAN MIGUEL BREWERY |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Options Analysis Analyze and evaluate options and option chains as a potential hedge for your portfolios |