Correlation Between GEELY AUTOMOBILE and INTER CARS
Can any of the company-specific risk be diversified away by investing in both GEELY AUTOMOBILE and INTER CARS 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 INTER CARS into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GEELY AUTOMOBILE and INTER CARS SA, you can compare the effects of market volatilities on GEELY AUTOMOBILE and INTER CARS 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 INTER CARS. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEELY AUTOMOBILE and INTER CARS.
Diversification Opportunities for GEELY AUTOMOBILE and INTER CARS
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between GEELY and INTER is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding GEELY AUTOMOBILE and INTER CARS SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on INTER CARS SA 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 INTER CARS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of INTER CARS SA has no effect on the direction of GEELY AUTOMOBILE i.e., GEELY AUTOMOBILE and INTER CARS go up and down completely randomly.
Pair Corralation between GEELY AUTOMOBILE and INTER CARS
Assuming the 90 days trading horizon GEELY AUTOMOBILE is expected to under-perform the INTER CARS. But the stock apears to be less risky and, when comparing its historical volatility, GEELY AUTOMOBILE is 1.21 times less risky than INTER CARS. The stock trades about -0.24 of its potential returns per unit of risk. The INTER CARS SA is currently generating about 0.32 of returns per unit of risk over similar time horizon. If you would invest 11,880 in INTER CARS SA on October 20, 2024 and sell it today you would earn a total of 1,420 from holding INTER CARS SA or generate 11.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GEELY AUTOMOBILE vs. INTER CARS SA
Performance |
| Timeline |
| GEELY AUTOMOBILE |
| INTER CARS SA |
GEELY AUTOMOBILE and INTER CARS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GEELY AUTOMOBILE and INTER CARS
The main advantage of trading using opposite GEELY AUTOMOBILE and INTER CARS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GEELY AUTOMOBILE position performs unexpectedly, INTER CARS 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 INTER CARS will offset losses from the drop in INTER CARS's long position.| GEELY AUTOMOBILE vs. Citic Telecom International | GEELY AUTOMOBILE vs. Acadia Healthcare | GEELY AUTOMOBILE vs. Darden Restaurants | GEELY AUTOMOBILE vs. SWISS WATER DECAFFCOFFEE |
| INTER CARS vs. CDL INVESTMENT | INTER CARS vs. Apollo Investment Corp | INTER CARS vs. CHRYSALIS INVESTMENTS LTD | INTER CARS vs. THAI BEVERAGE |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Stock Screener Find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook. | |
| Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |