Correlation Between Chlitina Holding and San Neng

Can any of the company-specific risk be diversified away by investing in both Chlitina Holding and San Neng 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 Chlitina Holding and San Neng into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Chlitina Holding and San Neng Group, you can compare the effects of market volatilities on Chlitina Holding and San Neng 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 Chlitina Holding with a short position of San Neng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chlitina Holding and San Neng.

Diversification Opportunities for Chlitina Holding and San Neng

0.28

Correlation Coefficient

Chlitina Holding  San Neng

Modest diversification

The 3 months correlation between Chlitina and San is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Chlitina Holding and San Neng Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on San Neng Group and Chlitina Holding 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 Chlitina Holding are associated (or correlated) with San Neng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of San Neng Group has no effect on the direction of Chlitina Holding i.e., Chlitina Holding and San Neng go up and down completely randomly.

Pair Corralation between Chlitina Holding and San Neng

Assuming the 90 days trading horizon Chlitina Holding is expected to generate 2.78 times more return on investment than San Neng. However, Chlitina Holding is 2.78 times more volatile than San Neng Group. It trades about 0.1 of its potential returns per unit of risk. San Neng Group is currently generating about 0.18 per unit of risk. If you would invest  11,200  in Chlitina Holding on December 5, 2024 and sell it today you would earn a total of  750.00  from holding Chlitina Holding or generate 6.7% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Chlitina Holding  vs.  San Neng Group

Chlitina Holding

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in Chlitina Holding are ranked lower than 2 (%) of all global equities and portfolios over the last 90 days. In spite of fairly stable basic indicators, Chlitina Holding is not utilizing all of its potentials. The latest stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

San Neng Group

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in San Neng Group are ranked lower than 10 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, San Neng may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Chlitina Holding and San Neng

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

The idea behind Chlitina Holding and San Neng Group 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.

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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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.