Correlation Between CeoTronics and Wenzhou Kangning
Can any of the company-specific risk be diversified away by investing in both CeoTronics and Wenzhou Kangning 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 CeoTronics and Wenzhou Kangning into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CeoTronics AG and Wenzhou Kangning Hospital, you can compare the effects of market volatilities on CeoTronics and Wenzhou Kangning 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 CeoTronics with a short position of Wenzhou Kangning. Check out your portfolio center. Please also check ongoing floating volatility patterns of CeoTronics and Wenzhou Kangning.
Diversification Opportunities for CeoTronics and Wenzhou Kangning
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between CeoTronics and Wenzhou is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding CeoTronics AG and Wenzhou Kangning Hospital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wenzhou Kangning Hospital and CeoTronics 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 CeoTronics AG are associated (or correlated) with Wenzhou Kangning. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wenzhou Kangning Hospital has no effect on the direction of CeoTronics i.e., CeoTronics and Wenzhou Kangning go up and down completely randomly.
Pair Corralation between CeoTronics and Wenzhou Kangning
Assuming the 90 days trading horizon CeoTronics AG is expected to under-perform the Wenzhou Kangning. In addition to that, CeoTronics is 1.22 times more volatile than Wenzhou Kangning Hospital. It trades about -0.28 of its total potential returns per unit of risk. Wenzhou Kangning Hospital is currently generating about -0.24 per unit of volatility. If you would invest 153.00 in Wenzhou Kangning Hospital on October 12, 2024 and sell it today you would lose (10.00) from holding Wenzhou Kangning Hospital or give up 6.54% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
CeoTronics AG vs. Wenzhou Kangning Hospital
Performance |
| Timeline |
| CeoTronics AG |
| Wenzhou Kangning Hospital |
CeoTronics and Wenzhou Kangning Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CeoTronics and Wenzhou Kangning
The main advantage of trading using opposite CeoTronics and Wenzhou Kangning positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CeoTronics position performs unexpectedly, Wenzhou Kangning 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 Wenzhou Kangning will offset losses from the drop in Wenzhou Kangning's long position.| CeoTronics vs. Shenzhen Investment Limited | CeoTronics vs. GOLD ROAD RES | CeoTronics vs. Air Transport Services | CeoTronics vs. New Residential Investment |
| Wenzhou Kangning vs. WT OFFSHORE | Wenzhou Kangning vs. Richardson Electronics | Wenzhou Kangning vs. STORE ELECTRONIC | Wenzhou Kangning vs. Eidesvik Offshore ASA |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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