Correlation Between Gushen and CTS

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

By analyzing existing cross correlation between Gushen Inc and CTS Corporation, you can compare the effects of market volatilities on Gushen and CTS 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 Gushen with a short position of CTS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gushen and CTS.

Diversification Opportunities for Gushen and CTS

0.25

Correlation Coefficient

Gushen  CTS

Modest diversification

The 3 months correlation between Gushen and CTS is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Gushen Inc and CTS Corp. in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CTS Corporation and Gushen 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 Gushen Inc are associated (or correlated) with CTS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CTS Corporation has no effect on the direction of Gushen i.e., Gushen and CTS go up and down completely randomly.

Pair Corralation between Gushen and CTS

If you would invest  2,270  in Gushen Inc on October 11, 2024 and sell it today you would earn a total of  0.00  from holding Gushen Inc or generate 0.0% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	4.76%
Values	Daily Returns

Gushen Inc  vs.  CTS Corp.

Gushen Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Gushen Inc has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy technical indicators, Gushen is not utilizing all of its potentials. The newest stock price disarray, may contribute to short-term losses for the investors.

CTS Corporation

Risk-Adjusted Performance

4 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in CTS Corporation are ranked lower than 4 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, CTS may actually be approaching a critical reversion point that can send shares even higher in February 2025.

Pair Trading with Gushen and CTS

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

The idea behind Gushen Inc and CTS Corporation 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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.