Correlation Between China Xuefeng and Cenntro Electric
Can any of the company-specific risk be diversified away by investing in both China Xuefeng and Cenntro Electric 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 Xuefeng and Cenntro Electric into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Xuefeng Environmental and Cenntro Electric Group, you can compare the effects of market volatilities on China Xuefeng and Cenntro Electric 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 Xuefeng with a short position of Cenntro Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Xuefeng and Cenntro Electric.
Diversification Opportunities for China Xuefeng and Cenntro Electric
-0.12 | Correlation Coefficient |
Good diversification
The 3 months correlation between China and Cenntro is -0.12. Overlapping area represents the amount of risk that can be diversified away by holding China Xuefeng Environmental and Cenntro Electric Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cenntro Electric and China Xuefeng 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 Xuefeng Environmental are associated (or correlated) with Cenntro Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cenntro Electric has no effect on the direction of China Xuefeng i.e., China Xuefeng and Cenntro Electric go up and down completely randomly.
Pair Corralation between China Xuefeng and Cenntro Electric
Given the investment horizon of 90 days China Xuefeng Environmental is expected to generate 3.99 times more return on investment than Cenntro Electric. However, China Xuefeng is 3.99 times more volatile than Cenntro Electric Group. It trades about 0.1 of its potential returns per unit of risk. Cenntro Electric Group is currently generating about -0.05 per unit of risk. If you would invest 5.00 in China Xuefeng Environmental on August 28, 2024 and sell it today you would lose (3.00) from holding China Xuefeng Environmental or give up 60.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Xuefeng Environmental vs. Cenntro Electric Group
Performance |
| Timeline |
| China Xuefeng Enviro |
| Cenntro Electric |
China Xuefeng and Cenntro Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Xuefeng and Cenntro Electric
The main advantage of trading using opposite China Xuefeng and Cenntro Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Xuefeng position performs unexpectedly, Cenntro Electric 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 Cenntro Electric will offset losses from the drop in Cenntro Electric's long position.| China Xuefeng vs. Isuzu Motors | China Xuefeng vs. Renault SA | China Xuefeng vs. Toyota Motor Corp | China Xuefeng vs. Porsche Automobile Holding |
| Cenntro Electric vs. Mullen Automotive | Cenntro Electric vs. Canoo Inc | Cenntro Electric vs. Hyzon Motors | Cenntro Electric vs. AYRO 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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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