Correlation Between China Resources and Nebius Group
Can any of the company-specific risk be diversified away by investing in both China Resources and Nebius Group 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 Resources and Nebius Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Resources Beer and Nebius Group NV, you can compare the effects of market volatilities on China Resources and Nebius Group 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 Resources with a short position of Nebius Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Resources and Nebius Group.
Diversification Opportunities for China Resources and Nebius Group
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Nebius is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding China Resources Beer and Nebius Group NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nebius Group NV and China Resources 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 Resources Beer are associated (or correlated) with Nebius Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nebius Group NV has no effect on the direction of China Resources i.e., China Resources and Nebius Group go up and down completely randomly.
Pair Corralation between China Resources and Nebius Group
Assuming the 90 days horizon China Resources Beer is expected to under-perform the Nebius Group. But the pink sheet apears to be less risky and, when comparing its historical volatility, China Resources Beer is 2.75 times less risky than Nebius Group. The pink sheet trades about -0.05 of its potential returns per unit of risk. The Nebius Group NV is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 3,074 in Nebius Group NV on November 9, 2024 and sell it today you would earn a total of 381.00 from holding Nebius Group NV or generate 12.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 90.91% |
| Values | Daily Returns |
China Resources Beer vs. Nebius Group NV
Performance |
| Timeline |
| China Resources Beer |
| Nebius Group NV |
China Resources and Nebius Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Resources and Nebius Group
The main advantage of trading using opposite China Resources and Nebius Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Resources position performs unexpectedly, Nebius Group 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 Nebius Group will offset losses from the drop in Nebius Group's long position.| China Resources vs. Tsingtao Brewery Co | China Resources vs. Budweiser Brewing | China Resources vs. Boston Beer | China Resources vs. Anheuser Busch Inbev |
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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 Stocks Directory module to find actively traded stocks across global markets.
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