Correlation Between Kaixin Auto and SunCar Technology
Can any of the company-specific risk be diversified away by investing in both Kaixin Auto and SunCar Technology 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 Kaixin Auto and SunCar Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Kaixin Auto Holdings and SunCar Technology Group, you can compare the effects of market volatilities on Kaixin Auto and SunCar Technology 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 Kaixin Auto with a short position of SunCar Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kaixin Auto and SunCar Technology.
Diversification Opportunities for Kaixin Auto and SunCar Technology
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Kaixin and SunCar is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Kaixin Auto Holdings and SunCar Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SunCar Technology and Kaixin Auto 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 Kaixin Auto Holdings are associated (or correlated) with SunCar Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SunCar Technology has no effect on the direction of Kaixin Auto i.e., Kaixin Auto and SunCar Technology go up and down completely randomly.
Pair Corralation between Kaixin Auto and SunCar Technology
Given the investment horizon of 90 days Kaixin Auto Holdings is expected to under-perform the SunCar Technology. In addition to that, Kaixin Auto is 1.0 times more volatile than SunCar Technology Group. It trades about -0.24 of its total potential returns per unit of risk. SunCar Technology Group is currently generating about 0.31 per unit of volatility. If you would invest 18.00 in SunCar Technology Group on August 24, 2024 and sell it today you would earn a total of 17.00 from holding SunCar Technology Group or generate 94.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 82.61% |
| Values | Daily Returns |
Kaixin Auto Holdings vs. SunCar Technology Group
Performance |
| Timeline |
| Kaixin Auto Holdings |
| SunCar Technology |
Kaixin Auto and SunCar Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kaixin Auto and SunCar Technology
The main advantage of trading using opposite Kaixin Auto and SunCar Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kaixin Auto position performs unexpectedly, SunCar Technology 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 SunCar Technology will offset losses from the drop in SunCar Technology's long position.| Kaixin Auto vs. Vroom Inc | Kaixin Auto vs. Cango Inc | Kaixin Auto vs. Cars Inc | Kaixin Auto vs. KAR Auction Services |
| SunCar Technology vs. Camping World Holdings | SunCar Technology vs. Kingsway Financial Services | SunCar Technology vs. CarMax Inc | SunCar Technology vs. SunCar Technology Group |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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