Correlation Between CEMATRIX and China National
Can any of the company-specific risk be diversified away by investing in both CEMATRIX and China National 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 CEMATRIX and China National into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CEMATRIX and China National Building, you can compare the effects of market volatilities on CEMATRIX and China National 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 CEMATRIX with a short position of China National. Check out your portfolio center. Please also check ongoing floating volatility patterns of CEMATRIX and China National.
Diversification Opportunities for CEMATRIX and China National
-0.76 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between CEMATRIX and China is -0.76. Overlapping area represents the amount of risk that can be diversified away by holding CEMATRIX and China National Building in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China National Building and CEMATRIX 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 CEMATRIX are associated (or correlated) with China National. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China National Building has no effect on the direction of CEMATRIX i.e., CEMATRIX and China National go up and down completely randomly.
Pair Corralation between CEMATRIX and China National
Assuming the 90 days horizon CEMATRIX is expected to generate 29.89 times less return on investment than China National. In addition to that, CEMATRIX is 1.04 times more volatile than China National Building. It trades about 0.0 of its total potential returns per unit of risk. China National Building is currently generating about 0.13 per unit of volatility. If you would invest 1,455 in China National Building on August 30, 2024 and sell it today you would earn a total of 666.00 from holding China National Building or generate 45.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CEMATRIX vs. China National Building
Performance |
| Timeline |
| CEMATRIX |
| China National Building |
CEMATRIX and China National Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CEMATRIX and China National
The main advantage of trading using opposite CEMATRIX and China National positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CEMATRIX position performs unexpectedly, China National 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 China National will offset losses from the drop in China National's long position.| CEMATRIX vs. Tecnoglass | CEMATRIX vs. Xinyi Glass Holdings | CEMATRIX vs. Anhui Conch Cement | CEMATRIX vs. Basanite |
| China National vs. Anhui Conch Cement | China National vs. Buzzi Unicem SpA | China National vs. Wienerberger Baustoffindustrie | China National vs. Lafargeholcim Ltd ADR |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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