Correlation Between Qingling Motors and KION Group
Can any of the company-specific risk be diversified away by investing in both Qingling Motors and KION Group 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 Qingling Motors and KION Group into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Qingling Motors Co and KION Group AG, you can compare the effects of market volatilities on Qingling Motors and KION Group 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 Qingling Motors with a short position of KION Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qingling Motors and KION Group.
Diversification Opportunities for Qingling Motors and KION Group
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Qingling and KION is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Qingling Motors Co and KION Group AG in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on KION Group AG and Qingling Motors 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 Qingling Motors Co are associated (or correlated) with KION Group. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of KION Group AG has no effect on the direction of Qingling Motors i.e., Qingling Motors and KION Group go up and down completely randomly.
Pair Corralation between Qingling Motors and KION Group
Assuming the 90 days horizon Qingling Motors Co is expected to under-perform the KION Group. In addition to that, Qingling Motors is 1.82 times more volatile than KION Group AG. It trades about -0.01 of its total potential returns per unit of risk. KION Group AG is currently generating about 0.04 per unit of volatility. If you would invest 2,644 in KION Group AG on September 14, 2024 and sell it today you would earn a total of 897.00 from holding KION Group AG or generate 33.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qingling Motors Co vs. KION Group AG
Performance |
| Timeline |
| Qingling Motors |
| KION Group AG |
Qingling Motors and KION Group Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qingling Motors and KION Group
The main advantage of trading using opposite Qingling Motors and KION Group positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qingling Motors position performs unexpectedly, KION Group 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 KION Group will offset losses from the drop in KION Group's long position.| Qingling Motors vs. Charoen Pokphand Foods | Qingling Motors vs. Shenandoah Telecommunications | Qingling Motors vs. National Beverage Corp | Qingling Motors vs. Tyson Foods |
| KION Group vs. The Shyft Group | KION Group vs. Hyster Yale Materials Handling | KION Group vs. Qingling Motors Co |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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