Correlation Between Guandao Puer and OPmobility

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

By analyzing existing cross correlation between Guandao Puer Investment and OPmobility SE, you can compare the effects of market volatilities on Guandao Puer and OPmobility 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 Guandao Puer with a short position of OPmobility. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guandao Puer and OPmobility.

Diversification Opportunities for Guandao Puer and OPmobility

0.0

Correlation Coefficient

Guandao Puer  OPmobility

Pay attention - limited upside

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

Pair Corralation between Guandao Puer and OPmobility

If you would invest  864.00  in OPmobility SE on October 5, 2024 and sell it today you would earn a total of  136.00  from holding OPmobility SE or generate 15.74% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Flat
Strength	Insignificant
Accuracy	96.77%
Values	Daily Returns

Guandao Puer Investment  vs.  OPmobility SE

Guandao Puer Investment

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Guandao Puer Investment has generated negative risk-adjusted returns adding no value to investors with long positions. Even with relatively invariable basic indicators, Guandao Puer is not utilizing all of its potentials. The latest stock price agitation, may contribute to short-term losses for the retail investors.

OPmobility SE

Risk-Adjusted Performance

8 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in OPmobility SE are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak primary indicators, OPmobility sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Guandao Puer and OPmobility

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

The idea behind Guandao Puer Investment and OPmobility SE 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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.