Correlation Between China Aircraft and CDT Environmental
Can any of the company-specific risk be diversified away by investing in both China Aircraft and CDT Environmental 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 Aircraft and CDT Environmental into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Aircraft Leasing and CDT Environmental Technology, you can compare the effects of market volatilities on China Aircraft and CDT Environmental 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 Aircraft with a short position of CDT Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Aircraft and CDT Environmental.
Diversification Opportunities for China Aircraft and CDT Environmental
0.2 | Correlation Coefficient |
Modest diversification
The 3 months correlation between China and CDT is 0.2. Overlapping area represents the amount of risk that can be diversified away by holding China Aircraft Leasing and CDT Environmental Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CDT Environmental and China Aircraft 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 Aircraft Leasing are associated (or correlated) with CDT Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CDT Environmental has no effect on the direction of China Aircraft i.e., China Aircraft and CDT Environmental go up and down completely randomly.
Pair Corralation between China Aircraft and CDT Environmental
If you would invest 293.00 in CDT Environmental Technology on August 31, 2024 and sell it today you would earn a total of 22.00 from holding CDT Environmental Technology or generate 7.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.65% |
| Values | Daily Returns |
China Aircraft Leasing vs. CDT Environmental Technology
Performance |
| Timeline |
| China Aircraft Leasing |
| CDT Environmental |
China Aircraft and CDT Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Aircraft and CDT Environmental
The main advantage of trading using opposite China Aircraft and CDT Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Aircraft position performs unexpectedly, CDT Environmental 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 CDT Environmental will offset losses from the drop in CDT Environmental's long position.| China Aircraft vs. Skechers USA | China Aircraft vs. United Homes Group | China Aircraft vs. Procter Gamble | China Aircraft vs. Church Dwight |
| CDT Environmental vs. ASE Industrial Holding | CDT Environmental vs. FormFactor | CDT Environmental vs. Fomento Economico Mexicano | CDT Environmental vs. Compania Cervecerias Unidas |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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