Correlation Between Mamas Creations and Cheche Group

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

By analyzing existing cross correlation between Mamas Creations and Cheche Group Class, you can compare the effects of market volatilities on Mamas Creations and Cheche Group 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 Mamas Creations with a short position of Cheche Group. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mamas Creations and Cheche Group.

Diversification Opportunities for Mamas Creations and Cheche Group

0.0

Correlation Coefficient

Mamas Creations  Cheche Group

Pay attention - limited upside

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

Pair Corralation between Mamas Creations and Cheche Group

Given the investment horizon of 90 days Mamas Creations is expected to under-perform the Cheche Group. In addition to that, Mamas Creations is 1.29 times more volatile than Cheche Group Class. It trades about -0.24 of its total potential returns per unit of risk. Cheche Group Class is currently generating about 0.17 per unit of volatility. If you would invest  86.00  in Cheche Group Class on October 8, 2024 and sell it today you would earn a total of  9.00  from holding Cheche Group Class or generate 10.47% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Mamas Creations  vs.  Cheche Group Class

Mamas Creations

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Mamas Creations has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong primary indicators, Mamas Creations is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Cheche Group Class

Risk-Adjusted Performance

9 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Cheche Group Class are ranked lower than 9 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain fundamental indicators, Cheche Group reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Mamas Creations and Cheche Group

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

The idea behind Mamas Creations and Cheche Group Class 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.

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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.