Correlation Between De Rucci and Chongqing Changan
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By analyzing existing cross correlation between De Rucci Healthy and Chongqing Changan Automobile, you can compare the effects of market volatilities on De Rucci and Chongqing Changan 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 De Rucci with a short position of Chongqing Changan. Check out your portfolio center. Please also check ongoing floating volatility patterns of De Rucci and Chongqing Changan.
Diversification Opportunities for De Rucci and Chongqing Changan
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 001323 and Chongqing is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding De Rucci Healthy and Chongqing Changan Automobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Changan and De Rucci 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 De Rucci Healthy are associated (or correlated) with Chongqing Changan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chongqing Changan has no effect on the direction of De Rucci i.e., De Rucci and Chongqing Changan go up and down completely randomly.
Pair Corralation between De Rucci and Chongqing Changan
Assuming the 90 days trading horizon De Rucci Healthy is expected to generate 1.26 times more return on investment than Chongqing Changan. However, De Rucci is 1.26 times more volatile than Chongqing Changan Automobile. It trades about 0.03 of its potential returns per unit of risk. Chongqing Changan Automobile is currently generating about 0.02 per unit of risk. If you would invest 3,144 in De Rucci Healthy on September 6, 2024 and sell it today you would earn a total of 775.00 from holding De Rucci Healthy or generate 24.65% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
De Rucci Healthy vs. Chongqing Changan Automobile
Performance |
Timeline |
De Rucci Healthy |
Chongqing Changan |
De Rucci and Chongqing Changan Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with De Rucci and Chongqing Changan
The main advantage of trading using opposite De Rucci and Chongqing Changan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if De Rucci position performs unexpectedly, Chongqing Changan 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 Chongqing Changan will offset losses from the drop in Chongqing Changan's long position.De Rucci vs. Industrial and Commercial | De Rucci vs. Agricultural Bank of | De Rucci vs. China Construction Bank | De Rucci vs. Bank of China |
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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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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