Correlation Between NAKED WINES and Chuangs China
Can any of the company-specific risk be diversified away by investing in both NAKED WINES 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 NAKED WINES and Chuangs China into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between NAKED WINES PLC and Chuangs China Investments, you can compare the effects of market volatilities on NAKED WINES 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 NAKED WINES with a short position of Chuangs China. Check out your portfolio center. Please also check ongoing floating volatility patterns of NAKED WINES and Chuangs China.
Diversification Opportunities for NAKED WINES and Chuangs China
0.17 | Correlation Coefficient |
Average diversification
The 3 months correlation between NAKED and Chuangs is 0.17. Overlapping area represents the amount of risk that can be diversified away by holding NAKED WINES PLC 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 NAKED WINES 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 NAKED WINES PLC 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 NAKED WINES i.e., NAKED WINES and Chuangs China go up and down completely randomly.
Pair Corralation between NAKED WINES and Chuangs China
Assuming the 90 days horizon NAKED WINES PLC is expected to under-perform the Chuangs China. In addition to that, NAKED WINES is 3.65 times more volatile than Chuangs China Investments. It trades about 0.0 of its total potential returns per unit of risk. Chuangs China Investments is currently generating about 0.0 per unit of volatility. If you would invest 1.00 in Chuangs China Investments on August 29, 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 Together |
| Strength | Insignificant |
| Accuracy | 98.46% |
| Values | Daily Returns |
NAKED WINES PLC vs. Chuangs China Investments
Performance |
| Timeline |
| NAKED WINES PLC |
| Chuangs China Investments |
NAKED WINES and Chuangs China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with NAKED WINES and Chuangs China
The main advantage of trading using opposite NAKED WINES and Chuangs China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if NAKED WINES 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.| NAKED WINES vs. Hawesko Holding AG | NAKED WINES vs. ANDREW PELLER LTD | NAKED WINES vs. CHINA TONTINE WINES |
| Chuangs China vs. Playtech plc | Chuangs China vs. KOOL2PLAY SA ZY | Chuangs China vs. PLAYSTUDIOS A DL 0001 | Chuangs China vs. ANTA SPORTS PRODUCT |
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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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