Correlation Between International CSRC and Penpower Technology

Can any of the company-specific risk be diversified away by investing in both International CSRC and Penpower Technology 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 International CSRC and Penpower Technology into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between International CSRC Investment and Penpower Technology, you can compare the effects of market volatilities on International CSRC and Penpower Technology 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 International CSRC with a short position of Penpower Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of International CSRC and Penpower Technology.

Diversification Opportunities for International CSRC and Penpower Technology

-0.09

Correlation Coefficient

International CSRC  Penpower Technology

Good diversification

The 3 months correlation between International and Penpower is -0.09. Overlapping area represents the amount of risk that can be diversified away by holding International CSRC Investment and Penpower Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Penpower Technology and International CSRC 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 International CSRC Investment are associated (or correlated) with Penpower Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Penpower Technology has no effect on the direction of International CSRC i.e., International CSRC and Penpower Technology go up and down completely randomly.

Pair Corralation between International CSRC and Penpower Technology

Assuming the 90 days trading horizon International CSRC Investment is expected to under-perform the Penpower Technology. In addition to that, International CSRC is 1.77 times more volatile than Penpower Technology. It trades about -0.56 of its total potential returns per unit of risk. Penpower Technology is currently generating about -0.13 per unit of volatility. If you would invest  2,720  in Penpower Technology on October 10, 2024 and sell it today you would lose (80.00) from holding Penpower Technology or give up 2.94% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

International CSRC Investment  vs.  Penpower Technology

International CSRC

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days International CSRC Investment has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of abnormal performance in the last few months, the Stock's basic indicators remain fairly stable which may send shares a bit higher in February 2025. The latest fuss may also be a sign of long-term up-swing for the venture sophisticated investors.

Penpower Technology

Risk-Adjusted Performance

12 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Penpower Technology are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Penpower Technology showed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with International CSRC and Penpower Technology

The main advantage of trading using opposite International CSRC and Penpower Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if International CSRC position performs unexpectedly, Penpower Technology 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 Penpower Technology will offset losses from the drop in Penpower Technology's long position.

The idea behind International CSRC Investment and Penpower Technology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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 CEOs Directory module to screen CEOs from public companies around the world.