Correlation Between Chipotle Mexican and Uxin
Can any of the company-specific risk be diversified away by investing in both Chipotle Mexican and Uxin 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 Chipotle Mexican and Uxin into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chipotle Mexican Grill and Uxin, you can compare the effects of market volatilities on Chipotle Mexican and Uxin 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 Chipotle Mexican with a short position of Uxin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chipotle Mexican and Uxin.
Diversification Opportunities for Chipotle Mexican and Uxin
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Chipotle and Uxin is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Chipotle Mexican Grill and Uxin in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Uxin and Chipotle Mexican 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 Chipotle Mexican Grill are associated (or correlated) with Uxin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Uxin has no effect on the direction of Chipotle Mexican i.e., Chipotle Mexican and Uxin go up and down completely randomly.
Pair Corralation between Chipotle Mexican and Uxin
Considering the 90-day investment horizon Chipotle Mexican is expected to generate 6.41 times less return on investment than Uxin. But when comparing it to its historical volatility, Chipotle Mexican Grill is 2.87 times less risky than Uxin. It trades about 0.05 of its potential returns per unit of risk. Uxin is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 445.00 in Uxin on August 28, 2024 and sell it today you would earn a total of 63.00 from holding Uxin or generate 14.16% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chipotle Mexican Grill vs. Uxin
Performance |
| Timeline |
| Chipotle Mexican Grill |
| Uxin |
Chipotle Mexican and Uxin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chipotle Mexican and Uxin
The main advantage of trading using opposite Chipotle Mexican and Uxin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chipotle Mexican position performs unexpectedly, Uxin 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 Uxin will offset losses from the drop in Uxin's long position.| Chipotle Mexican vs. Starbucks | Chipotle Mexican vs. Dominos Pizza | Chipotle Mexican vs. Yum Brands | Chipotle Mexican vs. The Wendys Co |
| Uxin vs. Kingsway Financial Services | Uxin vs. KAR Auction Services | Uxin vs. Cango Inc | Uxin vs. Vroom Inc |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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