Correlation Between China World and Songz Automobile
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By analyzing existing cross correlation between China World Trade and Songz Automobile Air, you can compare the effects of market volatilities on China World and Songz 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 China World with a short position of Songz Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of China World and Songz Automobile.
Diversification Opportunities for China World and Songz Automobile
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between China and Songz is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding China World Trade and Songz Automobile Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Songz Automobile Air and China World 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 China World Trade are associated (or correlated) with Songz Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Songz Automobile Air has no effect on the direction of China World i.e., China World and Songz Automobile go up and down completely randomly.
Pair Corralation between China World and Songz Automobile
Assuming the 90 days trading horizon China World Trade is expected to under-perform the Songz Automobile. But the stock apears to be less risky and, when comparing its historical volatility, China World Trade is 1.2 times less risky than Songz Automobile. The stock trades about -0.04 of its potential returns per unit of risk. The Songz Automobile Air is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 557.00 in Songz Automobile Air on September 24, 2024 and sell it today you would earn a total of 139.00 from holding Songz Automobile Air or generate 24.96% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
China World Trade vs. Songz Automobile Air
Performance |
Timeline |
China World Trade |
Songz Automobile Air |
China World and Songz Automobile Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with China World and Songz Automobile
The main advantage of trading using opposite China World and Songz Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China World position performs unexpectedly, Songz 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 Songz Automobile will offset losses from the drop in Songz Automobile's long position.China World vs. PetroChina Co Ltd | China World vs. China Mobile Limited | China World vs. CNOOC Limited | China World vs. Ping An Insurance |
Songz Automobile vs. China World Trade | Songz Automobile vs. Iat Automobile Technology | Songz Automobile vs. Quectel Wireless Solutions | Songz Automobile vs. Guangzhou Haige Communications |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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