Correlation Between Kandi Technologies and Aptiv PLC
Can any of the company-specific risk be diversified away by investing in both Kandi Technologies and Aptiv PLC 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 Kandi Technologies and Aptiv PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kandi Technologies Group and Aptiv PLC, you can compare the effects of market volatilities on Kandi Technologies and Aptiv PLC 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 Kandi Technologies with a short position of Aptiv PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kandi Technologies and Aptiv PLC.
Diversification Opportunities for Kandi Technologies and Aptiv PLC
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kandi and Aptiv is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Kandi Technologies Group and Aptiv PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aptiv PLC and Kandi Technologies 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 Kandi Technologies Group are associated (or correlated) with Aptiv PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aptiv PLC has no effect on the direction of Kandi Technologies i.e., Kandi Technologies and Aptiv PLC go up and down completely randomly.
Pair Corralation between Kandi Technologies and Aptiv PLC
Given the investment horizon of 90 days Kandi Technologies Group is expected to under-perform the Aptiv PLC. In addition to that, Kandi Technologies is 2.08 times more volatile than Aptiv PLC. It trades about -0.3 of its total potential returns per unit of risk. Aptiv PLC is currently generating about 0.09 per unit of volatility. If you would invest 5,638 in Aptiv PLC on September 13, 2024 and sell it today you would earn a total of 199.00 from holding Aptiv PLC or generate 3.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.45% |
| Values | Daily Returns |
Kandi Technologies Group vs. Aptiv PLC
Performance |
| Timeline |
| Kandi Technologies |
| Aptiv PLC |
Kandi Technologies and Aptiv PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kandi Technologies and Aptiv PLC
The main advantage of trading using opposite Kandi Technologies and Aptiv PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kandi Technologies position performs unexpectedly, Aptiv PLC 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 Aptiv PLC will offset losses from the drop in Aptiv PLC's long position.| Kandi Technologies vs. Hyliion Holdings Corp | Kandi Technologies vs. Foresight Autonomous Holdings | Kandi Technologies vs. Aeva Technologies | Kandi Technologies vs. Aeye Inc |
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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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