Correlation Between All Things and China De
Can any of the company-specific risk be diversified away by investing in both All Things and China De 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 All Things and China De into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between All Things Mobile and China De Xiao, you can compare the effects of market volatilities on All Things and China De 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 All Things with a short position of China De. Check out your portfolio center. Please also check ongoing floating volatility patterns of All Things and China De.
Diversification Opportunities for All Things and China De
-0.23 | Correlation Coefficient |
Very good diversification
The 3 months correlation between All and China is -0.23. Overlapping area represents the amount of risk that can be diversified away by holding All Things Mobile and China De Xiao in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China De Xiao and All Things 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 All Things Mobile are associated (or correlated) with China De. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China De Xiao has no effect on the direction of All Things i.e., All Things and China De go up and down completely randomly.
Pair Corralation between All Things and China De
If you would invest 5.49 in All Things Mobile on December 18, 2024 and sell it today you would lose (0.10) from holding All Things Mobile or give up 1.82% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
All Things Mobile vs. China De Xiao
Performance |
Timeline |
All Things Mobile |
China De Xiao |
All Things and China De Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with All Things and China De
The main advantage of trading using opposite All Things and China De positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if All Things position performs unexpectedly, China De 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 China De will offset losses from the drop in China De's long position.All Things vs. Wialan Technologies | All Things vs. Genesis Electronics Group | All Things vs. Nextmart | All Things vs. HeadsUp Entertainment International |
China De vs. New Generation Consumer | China De vs. Southern ITS International | China De vs. A1 Group | China De vs. Cloudweb |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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