Correlation Between Intel and Datang International
Can any of the company-specific risk be diversified away by investing in both Intel and Datang International 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 Intel and Datang International into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Intel and Datang International Power, you can compare the effects of market volatilities on Intel and Datang International 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 Intel with a short position of Datang International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Intel and Datang International.
Diversification Opportunities for Intel and Datang International
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Intel and Datang is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Intel and Datang International Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Datang International and Intel 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 Intel are associated (or correlated) with Datang International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Datang International has no effect on the direction of Intel i.e., Intel and Datang International go up and down completely randomly.
Pair Corralation between Intel and Datang International
Assuming the 90 days trading horizon Intel is expected to generate 1.23 times more return on investment than Datang International. However, Intel is 1.23 times more volatile than Datang International Power. It trades about 0.17 of its potential returns per unit of risk. Datang International Power is currently generating about -0.08 per unit of risk. If you would invest 1,992 in Intel on September 1, 2024 and sell it today you would earn a total of 260.00 from holding Intel or generate 13.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Intel vs. Datang International Power
Performance |
| Timeline |
| Intel |
| Datang International |
Intel and Datang International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Intel and Datang International
The main advantage of trading using opposite Intel and Datang International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Intel position performs unexpectedly, Datang International 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 Datang International will offset losses from the drop in Datang International's long position.| Intel vs. PARKEN Sport Entertainment | Intel vs. ARDAGH METAL PACDL 0001 | Intel vs. Columbia Sportswear | Intel vs. POWER METALS |
| Datang International vs. CENTRICA ADR NEW | Datang International vs. TransAlta | Datang International vs. Superior Plus Corp | Datang International vs. NMI Holdings |
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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