Correlation Between China Yuchai and Ametek
Can any of the company-specific risk be diversified away by investing in both China Yuchai and Ametek 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 Yuchai and Ametek into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Yuchai International and Ametek Inc, you can compare the effects of market volatilities on China Yuchai and Ametek 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 Yuchai with a short position of Ametek. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Yuchai and Ametek.
Diversification Opportunities for China Yuchai and Ametek
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between China and Ametek is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding China Yuchai International and Ametek Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ametek Inc and China Yuchai 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 Yuchai International are associated (or correlated) with Ametek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ametek Inc has no effect on the direction of China Yuchai i.e., China Yuchai and Ametek go up and down completely randomly.
Pair Corralation between China Yuchai and Ametek
Considering the 90-day investment horizon China Yuchai International is expected to under-perform the Ametek. But the stock apears to be less risky and, when comparing its historical volatility, China Yuchai International is 1.03 times less risky than Ametek. The stock trades about -0.54 of its potential returns per unit of risk. The Ametek Inc is currently generating about 0.35 of returns per unit of risk over similar time horizon. If you would invest 16,667 in Ametek Inc on August 24, 2024 and sell it today you would earn a total of 2,909 from holding Ametek Inc or generate 17.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Yuchai International vs. Ametek Inc
Performance |
| Timeline |
| China Yuchai Interna |
| Ametek Inc |
China Yuchai and Ametek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Yuchai and Ametek
The main advantage of trading using opposite China Yuchai and Ametek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Yuchai position performs unexpectedly, Ametek 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 Ametek will offset losses from the drop in Ametek's long position.| China Yuchai vs. China Automotive Systems | China Yuchai vs. China Natural Resources | China Yuchai vs. Sonida Senior Living | China Yuchai vs. UTStarcom Holdings Corp |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data | |
| Stock Tickers Use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites | |
| Theme Ratings Determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance |