Correlation Between GEELY AUTOMOBILE and Coupang
Can any of the company-specific risk be diversified away by investing in both GEELY AUTOMOBILE and Coupang 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 Coupang into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GEELY AUTOMOBILE and Coupang, you can compare the effects of market volatilities on GEELY AUTOMOBILE and Coupang 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 Coupang. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEELY AUTOMOBILE and Coupang.
Diversification Opportunities for GEELY AUTOMOBILE and Coupang
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between GEELY and Coupang is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding GEELY AUTOMOBILE and Coupang in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Coupang 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 are associated (or correlated) with Coupang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Coupang has no effect on the direction of GEELY AUTOMOBILE i.e., GEELY AUTOMOBILE and Coupang go up and down completely randomly.
Pair Corralation between GEELY AUTOMOBILE and Coupang
Assuming the 90 days trading horizon GEELY AUTOMOBILE is expected to generate 1.09 times more return on investment than Coupang. However, GEELY AUTOMOBILE is 1.09 times more volatile than Coupang. It trades about 0.07 of its potential returns per unit of risk. Coupang is currently generating about 0.06 per unit of risk. If you would invest 94.00 in GEELY AUTOMOBILE on August 28, 2024 and sell it today you would earn a total of 64.00 from holding GEELY AUTOMOBILE or generate 68.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
GEELY AUTOMOBILE vs. Coupang
Performance |
| Timeline |
| GEELY AUTOMOBILE |
| Coupang |
GEELY AUTOMOBILE and Coupang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GEELY AUTOMOBILE and Coupang
The main advantage of trading using opposite GEELY AUTOMOBILE and Coupang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GEELY AUTOMOBILE position performs unexpectedly, Coupang 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 Coupang will offset losses from the drop in Coupang's long position.| GEELY AUTOMOBILE vs. Apple Inc | GEELY AUTOMOBILE vs. Apple Inc | GEELY AUTOMOBILE vs. Microsoft | GEELY AUTOMOBILE vs. Microsoft |
| Coupang vs. Sims Metal Management | Coupang vs. VIAPLAY GROUP AB | Coupang vs. Q2M Managementberatung AG | Coupang vs. ScanSource |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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