Correlation Between Cleanaway and Golden Long

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

By analyzing existing cross correlation between Cleanaway Co and Golden Long Teng, you can compare the effects of market volatilities on Cleanaway and Golden Long 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 Cleanaway with a short position of Golden Long. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cleanaway and Golden Long.

Diversification Opportunities for Cleanaway and Golden Long

0.0

Correlation Coefficient

Cleanaway  Golden Long

Pay attention - limited upside

The 3 months correlation between Cleanaway and Golden is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Cleanaway Co and Golden Long Teng in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Golden Long Teng and Cleanaway 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 Cleanaway Co are associated (or correlated) with Golden Long. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Golden Long Teng has no effect on the direction of Cleanaway i.e., Cleanaway and Golden Long go up and down completely randomly.

Pair Corralation between Cleanaway and Golden Long

If you would invest  17,950  in Cleanaway Co on December 25, 2024 and sell it today you would earn a total of  1,550  from holding Cleanaway Co or generate 8.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	1.79%
Values	Daily Returns

Cleanaway Co  vs.  Golden Long Teng

Cleanaway

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in Cleanaway Co are ranked lower than 23 (%) of all global equities and portfolios over the last 90 days. In spite of fairly abnormal basic indicators, Cleanaway may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Golden Long Teng

Risk-Adjusted Performance

Good

Over the last 90 days Golden Long Teng has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of fairly stable basic indicators, Golden Long is not utilizing all of its potentials. The current stock price fuss, may contribute to near-short-term losses for the sophisticated investors.

Pair Trading with Cleanaway and Golden Long

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

The idea behind Cleanaway Co and Golden Long Teng 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.