Correlation Between Geely Automobile and Ultra Clean
Can any of the company-specific risk be diversified away by investing in both Geely Automobile and Ultra Clean 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 Ultra Clean 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 Ultra Clean Holdings, you can compare the effects of market volatilities on Geely Automobile and Ultra Clean 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 Ultra Clean. Check out your portfolio center. Please also check ongoing floating volatility patterns of Geely Automobile and Ultra Clean.
Diversification Opportunities for Geely Automobile and Ultra Clean
-0.82 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Geely and Ultra is -0.82. Overlapping area represents the amount of risk that can be diversified away by holding Geely Automobile Holdings and Ultra Clean Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ultra Clean Holdings 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 Ultra Clean. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ultra Clean Holdings has no effect on the direction of Geely Automobile i.e., Geely Automobile and Ultra Clean go up and down completely randomly.
Pair Corralation between Geely Automobile and Ultra Clean
Assuming the 90 days horizon Geely Automobile Holdings is expected to generate 0.97 times more return on investment than Ultra Clean. However, Geely Automobile Holdings is 1.03 times less risky than Ultra Clean. It trades about 0.14 of its potential returns per unit of risk. Ultra Clean Holdings is currently generating about -0.02 per unit of risk. If you would invest 93.00 in Geely Automobile Holdings on September 2, 2024 and sell it today you would earn a total of 74.00 from holding Geely Automobile Holdings or generate 79.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Geely Automobile Holdings vs. Ultra Clean Holdings
Performance |
| Timeline |
| Geely Automobile Holdings |
| Ultra Clean Holdings |
Geely Automobile and Ultra Clean Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Geely Automobile and Ultra Clean
The main advantage of trading using opposite Geely Automobile and Ultra Clean positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Geely Automobile position performs unexpectedly, Ultra Clean 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 Ultra Clean will offset losses from the drop in Ultra Clean's long position.| Geely Automobile vs. ADRIATIC METALS LS 013355 | Geely Automobile vs. LION ONE METALS | Geely Automobile vs. GRIFFIN MINING LTD | Geely Automobile vs. Scientific Games |
| Ultra Clean vs. SENECA FOODS A | Ultra Clean vs. OURGAME INTHOLDL 00005 | Ultra Clean vs. AUSNUTRIA DAIRY | Ultra Clean vs. QINGCI GAMES 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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