Correlation Between CVW CLEANTECH and China BlueChemical
Can any of the company-specific risk be diversified away by investing in both CVW CLEANTECH and China BlueChemical 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 CVW CLEANTECH and China BlueChemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CVW CLEANTECH INC and China BlueChemical, you can compare the effects of market volatilities on CVW CLEANTECH and China BlueChemical 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 CVW CLEANTECH with a short position of China BlueChemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of CVW CLEANTECH and China BlueChemical.
Diversification Opportunities for CVW CLEANTECH and China BlueChemical
0.21 | Correlation Coefficient |
Modest diversification
The 3 months correlation between CVW and China is 0.21. Overlapping area represents the amount of risk that can be diversified away by holding CVW CLEANTECH INC and China BlueChemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China BlueChemical and CVW CLEANTECH 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 CVW CLEANTECH INC are associated (or correlated) with China BlueChemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China BlueChemical has no effect on the direction of CVW CLEANTECH i.e., CVW CLEANTECH and China BlueChemical go up and down completely randomly.
Pair Corralation between CVW CLEANTECH and China BlueChemical
Assuming the 90 days trading horizon CVW CLEANTECH INC is expected to generate 1.34 times more return on investment than China BlueChemical. However, CVW CLEANTECH is 1.34 times more volatile than China BlueChemical. It trades about 0.04 of its potential returns per unit of risk. China BlueChemical is currently generating about 0.05 per unit of risk. If you would invest 41.00 in CVW CLEANTECH INC on October 27, 2024 and sell it today you would earn a total of 14.00 from holding CVW CLEANTECH INC or generate 34.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CVW CLEANTECH INC vs. China BlueChemical
Performance |
| Timeline |
| CVW CLEANTECH INC |
| China BlueChemical |
CVW CLEANTECH and China BlueChemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CVW CLEANTECH and China BlueChemical
The main advantage of trading using opposite CVW CLEANTECH and China BlueChemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CVW CLEANTECH position performs unexpectedly, China BlueChemical 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 China BlueChemical will offset losses from the drop in China BlueChemical's long position.| CVW CLEANTECH vs. Zoom Video Communications | CVW CLEANTECH vs. Chunghwa Telecom Co | CVW CLEANTECH vs. TELECOM ITALIA | CVW CLEANTECH vs. Ribbon Communications |
| China BlueChemical vs. Chengdu PUTIAN Telecommunications | China BlueChemical vs. X FAB Silicon Foundries | China BlueChemical vs. Tower One Wireless | China BlueChemical vs. TRI CHEMICAL LABORATINC |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges | |
| Money Managers Screen money managers from public funds and ETFs managed around the world |