Correlation Between Chuangs China and Canadian Utilities
Can any of the company-specific risk be diversified away by investing in both Chuangs China and Canadian Utilities 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 Chuangs China and Canadian Utilities into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chuangs China Investments and Canadian Utilities Limited, you can compare the effects of market volatilities on Chuangs China and Canadian Utilities 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 Chuangs China with a short position of Canadian Utilities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chuangs China and Canadian Utilities.
Diversification Opportunities for Chuangs China and Canadian Utilities
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Chuangs and Canadian is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Chuangs China Investments and Canadian Utilities Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Canadian Utilities and Chuangs China 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 Chuangs China Investments are associated (or correlated) with Canadian Utilities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Canadian Utilities has no effect on the direction of Chuangs China i.e., Chuangs China and Canadian Utilities go up and down completely randomly.
Pair Corralation between Chuangs China and Canadian Utilities
Assuming the 90 days horizon Chuangs China is expected to generate 10.98 times less return on investment than Canadian Utilities. In addition to that, Chuangs China is 1.41 times more volatile than Canadian Utilities Limited. It trades about 0.01 of its total potential returns per unit of risk. Canadian Utilities Limited is currently generating about 0.12 per unit of volatility. If you would invest 1,907 in Canadian Utilities Limited on September 3, 2024 and sell it today you would earn a total of 492.00 from holding Canadian Utilities Limited or generate 25.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chuangs China Investments vs. Canadian Utilities Limited
Performance |
| Timeline |
| Chuangs China Investments |
| Canadian Utilities |
Chuangs China and Canadian Utilities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chuangs China and Canadian Utilities
The main advantage of trading using opposite Chuangs China and Canadian Utilities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chuangs China position performs unexpectedly, Canadian Utilities 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 Canadian Utilities will offset losses from the drop in Canadian Utilities' long position.| Chuangs China vs. Treasury Wine Estates | Chuangs China vs. GigaMedia | Chuangs China vs. NAKED WINES PLC | Chuangs China vs. Tencent Music Entertainment |
| Canadian Utilities vs. MAVEN WIRELESS SWEDEN | Canadian Utilities vs. Citic Telecom International | Canadian Utilities vs. Tower One Wireless | Canadian Utilities vs. Chunghwa Telecom Co |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
Other Complementary Tools
| Piotroski F Score Get Piotroski F Score based on the binary analysis strategy of nine different fundamentals | |
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas |