Correlation Between Corporate Office and Geely Automobile
Can any of the company-specific risk be diversified away by investing in both Corporate Office and Geely Automobile 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 Corporate Office and Geely Automobile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Corporate Office Properties and Geely Automobile Holdings, you can compare the effects of market volatilities on Corporate Office and Geely Automobile 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 Corporate Office with a short position of Geely Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Corporate Office and Geely Automobile.
Diversification Opportunities for Corporate Office and Geely Automobile
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Corporate and Geely is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Corporate Office Properties and Geely Automobile Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Geely Automobile Holdings and Corporate Office 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 Corporate Office Properties are associated (or correlated) with Geely Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Geely Automobile Holdings has no effect on the direction of Corporate Office i.e., Corporate Office and Geely Automobile go up and down completely randomly.
Pair Corralation between Corporate Office and Geely Automobile
Assuming the 90 days horizon Corporate Office Properties is expected to generate 1.08 times more return on investment than Geely Automobile. However, Corporate Office is 1.08 times more volatile than Geely Automobile Holdings. It trades about -0.09 of its potential returns per unit of risk. Geely Automobile Holdings is currently generating about -0.3 per unit of risk. If you would invest 3,089 in Corporate Office Properties on October 10, 2024 and sell it today you would lose (89.00) from holding Corporate Office Properties or give up 2.88% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Corporate Office Properties vs. Geely Automobile Holdings
Performance |
| Timeline |
| Corporate Office Pro |
| Geely Automobile Holdings |
Corporate Office and Geely Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Corporate Office and Geely Automobile
The main advantage of trading using opposite Corporate Office and Geely Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Corporate Office position performs unexpectedly, Geely Automobile 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 Geely Automobile will offset losses from the drop in Geely Automobile's long position.| Corporate Office vs. Astral Foods Limited | Corporate Office vs. FUYO GENERAL LEASE | Corporate Office vs. INDOFOOD AGRI RES | Corporate Office vs. Ebro Foods SA |
| Geely Automobile vs. Information Services International Dentsu | Geely Automobile vs. Synchrony Financial | Geely Automobile vs. Virtu Financial | Geely Automobile vs. The Hanover Insurance |
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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