Correlation Between Qingdao Choho and Changchun Faway
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By analyzing existing cross correlation between Qingdao Choho Industrial and Changchun Faway Automobile, you can compare the effects of market volatilities on Qingdao Choho and Changchun Faway 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 Qingdao Choho with a short position of Changchun Faway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qingdao Choho and Changchun Faway.
Diversification Opportunities for Qingdao Choho and Changchun Faway
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Qingdao and Changchun is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Qingdao Choho Industrial and Changchun Faway Automobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changchun Faway Auto and Qingdao Choho 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 Qingdao Choho Industrial are associated (or correlated) with Changchun Faway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changchun Faway Auto has no effect on the direction of Qingdao Choho i.e., Qingdao Choho and Changchun Faway go up and down completely randomly.
Pair Corralation between Qingdao Choho and Changchun Faway
Assuming the 90 days trading horizon Qingdao Choho Industrial is expected to under-perform the Changchun Faway. In addition to that, Qingdao Choho is 1.21 times more volatile than Changchun Faway Automobile. It trades about -0.02 of its total potential returns per unit of risk. Changchun Faway Automobile is currently generating about 0.02 per unit of volatility. If you would invest 834.00 in Changchun Faway Automobile on September 26, 2024 and sell it today you would earn a total of 54.00 from holding Changchun Faway Automobile or generate 6.47% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Qingdao Choho Industrial vs. Changchun Faway Automobile
Performance |
Timeline |
Qingdao Choho Industrial |
Changchun Faway Auto |
Qingdao Choho and Changchun Faway Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Qingdao Choho and Changchun Faway
The main advantage of trading using opposite Qingdao Choho and Changchun Faway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qingdao Choho position performs unexpectedly, Changchun Faway 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 Changchun Faway will offset losses from the drop in Changchun Faway's long position.Qingdao Choho vs. China Life Insurance | Qingdao Choho vs. Cinda Securities Co | Qingdao Choho vs. Piotech Inc A | Qingdao Choho vs. Dongxing Sec Co |
Changchun Faway vs. Guangzhou Automobile Group | Changchun Faway vs. Songz Automobile Air | Changchun Faway vs. Qingdao Choho Industrial | Changchun Faway vs. Dongfeng Automobile 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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