Correlation Between Geely Automobile and First Hydrogen
Can any of the company-specific risk be diversified away by investing in both Geely Automobile and First Hydrogen 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 Geely Automobile and First Hydrogen into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Geely Automobile Holdings and First Hydrogen Corp, you can compare the effects of market volatilities on Geely Automobile and First Hydrogen 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 Geely Automobile with a short position of First Hydrogen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Geely Automobile and First Hydrogen.
Diversification Opportunities for Geely Automobile and First Hydrogen
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Geely and First is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Geely Automobile Holdings and First Hydrogen Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Hydrogen Corp and Geely Automobile 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 Geely Automobile Holdings are associated (or correlated) with First Hydrogen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Hydrogen Corp has no effect on the direction of Geely Automobile i.e., Geely Automobile and First Hydrogen go up and down completely randomly.
Pair Corralation between Geely Automobile and First Hydrogen
Assuming the 90 days horizon Geely Automobile Holdings is expected to generate 0.96 times more return on investment than First Hydrogen. However, Geely Automobile Holdings is 1.04 times less risky than First Hydrogen. It trades about 0.18 of its potential returns per unit of risk. First Hydrogen Corp is currently generating about -0.02 per unit of risk. If you would invest 2,175 in Geely Automobile Holdings on August 28, 2024 and sell it today you would earn a total of 1,165 from holding Geely Automobile Holdings or generate 53.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Geely Automobile Holdings vs. First Hydrogen Corp
Performance |
| Timeline |
| Geely Automobile Holdings |
| First Hydrogen Corp |
Geely Automobile and First Hydrogen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Geely Automobile and First Hydrogen
The main advantage of trading using opposite Geely Automobile and First Hydrogen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Geely Automobile position performs unexpectedly, First Hydrogen 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 First Hydrogen will offset losses from the drop in First Hydrogen's long position.| Geely Automobile vs. Great Wall Motor | Geely Automobile vs. Polestar Automotive Holding | Geely Automobile vs. Dowlais Group plc | Geely Automobile vs. BYD Company Limited |
| First Hydrogen vs. BAIC Motor | First Hydrogen vs. Zapp Electric Vehicles | First Hydrogen vs. Guangzhou Automobile Group | First Hydrogen vs. Phoenix Motor Common |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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