Correlation Between China Resources and CALTAGIRONE EDITORE

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

By analyzing existing cross correlation between China Resources Power and CALTAGIRONE EDITORE, you can compare the effects of market volatilities on China Resources and CALTAGIRONE EDITORE 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 Resources with a short position of CALTAGIRONE EDITORE. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Resources and CALTAGIRONE EDITORE.

Diversification Opportunities for China Resources and CALTAGIRONE EDITORE

0.0

Correlation Coefficient

China Resources  CALTAGIRONE EDITORE

Pay attention - limited upside

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

Pair Corralation between China Resources and CALTAGIRONE EDITORE

If you would invest  57.00  in China Resources Power on October 4, 2024 and sell it today you would earn a total of  170.00  from holding China Resources Power or generate 298.25% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	0.2%
Values	Daily Returns

China Resources Power  vs.  CALTAGIRONE EDITORE

China Resources Power

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days China Resources Power has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest fragile performance, the Stock's basic indicators remain stable and the current disturbance on Wall Street may also be a sign of long-run gains for the company stockholders.

CALTAGIRONE EDITORE

Risk-Adjusted Performance

0 of 100

Good

Over the last 90 days CALTAGIRONE EDITORE has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of comparatively stable basic indicators, CALTAGIRONE EDITORE is not utilizing all of its potentials. The current stock price uproar, may contribute to short-horizon losses for the private investors.

Pair Trading with China Resources and CALTAGIRONE EDITORE

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

The idea behind China Resources Power and CALTAGIRONE EDITORE 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 Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.