Correlation Between ALERION CLEANPOWER and China Construction
Can any of the company-specific risk be diversified away by investing in both ALERION CLEANPOWER and China Construction 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 ALERION CLEANPOWER and China Construction into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ALERION CLEANPOWER and China Construction Bank, you can compare the effects of market volatilities on ALERION CLEANPOWER and China Construction 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 ALERION CLEANPOWER with a short position of China Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of ALERION CLEANPOWER and China Construction.
Diversification Opportunities for ALERION CLEANPOWER and China Construction
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between ALERION and China is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding ALERION CLEANPOWER and China Construction Bank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Construction Bank and ALERION CLEANPOWER 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 ALERION CLEANPOWER are associated (or correlated) with China Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Construction Bank has no effect on the direction of ALERION CLEANPOWER i.e., ALERION CLEANPOWER and China Construction go up and down completely randomly.
Pair Corralation between ALERION CLEANPOWER and China Construction
Assuming the 90 days trading horizon ALERION CLEANPOWER is expected to generate 1.59 times more return on investment than China Construction. However, ALERION CLEANPOWER is 1.59 times more volatile than China Construction Bank. It trades about 0.25 of its potential returns per unit of risk. China Construction Bank is currently generating about 0.15 per unit of risk. If you would invest 1,472 in ALERION CLEANPOWER on September 12, 2024 and sell it today you would earn a total of 292.00 from holding ALERION CLEANPOWER or generate 19.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ALERION CLEANPOWER vs. China Construction Bank
Performance |
| Timeline |
| ALERION CLEANPOWER |
| China Construction Bank |
ALERION CLEANPOWER and China Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ALERION CLEANPOWER and China Construction
The main advantage of trading using opposite ALERION CLEANPOWER and China Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ALERION CLEANPOWER position performs unexpectedly, China Construction 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 Construction will offset losses from the drop in China Construction's long position.| ALERION CLEANPOWER vs. USWE SPORTS AB | ALERION CLEANPOWER vs. ARISTOCRAT LEISURE | ALERION CLEANPOWER vs. RCM TECHNOLOGIES | ALERION CLEANPOWER vs. ACCSYS TECHPLC EO |
| China Construction vs. Chesapeake Utilities | China Construction vs. AM EAGLE OUTFITTERS | China Construction vs. Playa Hotels Resorts | China Construction vs. Canadian Utilities Limited |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
Other Complementary Tools
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Funds Screener Find actively-traded funds from around the world traded on over 30 global exchanges | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency |