Correlation Between GEELY AUTOMOBILE and Chuangs China
Can any of the company-specific risk be diversified away by investing in both GEELY AUTOMOBILE and Chuangs China 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 Chuangs China into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GEELY AUTOMOBILE and Chuangs China Investments, you can compare the effects of market volatilities on GEELY AUTOMOBILE and Chuangs China 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 Chuangs China. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEELY AUTOMOBILE and Chuangs China.
Diversification Opportunities for GEELY AUTOMOBILE and Chuangs China
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between GEELY and Chuangs is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding GEELY AUTOMOBILE and Chuangs China Investments in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chuangs China Investments 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 Chuangs China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chuangs China Investments has no effect on the direction of GEELY AUTOMOBILE i.e., GEELY AUTOMOBILE and Chuangs China go up and down completely randomly.
Pair Corralation between GEELY AUTOMOBILE and Chuangs China
If you would invest 1.00 in Chuangs China Investments on October 16, 2024 and sell it today you would earn a total of 0.00 from holding Chuangs China Investments or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GEELY AUTOMOBILE vs. Chuangs China Investments
Performance |
| Timeline |
| GEELY AUTOMOBILE |
| Chuangs China Investments |
GEELY AUTOMOBILE and Chuangs China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GEELY AUTOMOBILE and Chuangs China
The main advantage of trading using opposite GEELY AUTOMOBILE and Chuangs China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GEELY AUTOMOBILE position performs unexpectedly, Chuangs China 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 Chuangs China will offset losses from the drop in Chuangs China's long position.| GEELY AUTOMOBILE vs. Easy Software AG | GEELY AUTOMOBILE vs. Martin Marietta Materials | GEELY AUTOMOBILE vs. Plastic Omnium | GEELY AUTOMOBILE vs. UPDATE SOFTWARE |
| Chuangs China vs. Corporate Office Properties | Chuangs China vs. OFFICE DEPOT | Chuangs China vs. GEELY AUTOMOBILE | Chuangs China vs. Thai Beverage Public |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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