Correlation Between Kandi Technologies and Melexis NV
Can any of the company-specific risk be diversified away by investing in both Kandi Technologies and Melexis NV 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 Melexis NV 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 Melexis NV, you can compare the effects of market volatilities on Kandi Technologies and Melexis NV 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 Melexis NV. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kandi Technologies and Melexis NV.
Diversification Opportunities for Kandi Technologies and Melexis NV
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kandi and Melexis is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Kandi Technologies Group and Melexis NV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Melexis NV 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 Melexis NV. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Melexis NV has no effect on the direction of Kandi Technologies i.e., Kandi Technologies and Melexis NV go up and down completely randomly.
Pair Corralation between Kandi Technologies and Melexis NV
If you would invest 7,425 in Melexis NV on August 26, 2024 and sell it today you would earn a total of 0.00 from holding Melexis NV or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kandi Technologies Group vs. Melexis NV
Performance |
| Timeline |
| Kandi Technologies |
| Melexis NV |
Kandi Technologies and Melexis NV Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kandi Technologies and Melexis NV
The main advantage of trading using opposite Kandi Technologies and Melexis NV positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kandi Technologies position performs unexpectedly, Melexis NV 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 Melexis NV will offset losses from the drop in Melexis NV'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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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