Correlation Between Phoenix and Guangzhou Automobile
Can any of the company-specific risk be diversified away by investing in both Phoenix and Guangzhou Automobile 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 Phoenix and Guangzhou Automobile into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Phoenix Motor Common and Guangzhou Automobile Group, you can compare the effects of market volatilities on Phoenix and Guangzhou Automobile 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 Phoenix with a short position of Guangzhou Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Phoenix and Guangzhou Automobile.
Diversification Opportunities for Phoenix and Guangzhou Automobile
0.1 | Correlation Coefficient |
Average diversification
The 3 months correlation between Phoenix and Guangzhou is 0.1. Overlapping area represents the amount of risk that can be diversified away by holding Phoenix Motor Common and Guangzhou Automobile Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Automobile and Phoenix 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 Phoenix Motor Common are associated (or correlated) with Guangzhou Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Automobile has no effect on the direction of Phoenix i.e., Phoenix and Guangzhou Automobile go up and down completely randomly.
Pair Corralation between Phoenix and Guangzhou Automobile
Considering the 90-day investment horizon Phoenix Motor Common is expected to generate 3.07 times more return on investment than Guangzhou Automobile. However, Phoenix is 3.07 times more volatile than Guangzhou Automobile Group. It trades about 0.08 of its potential returns per unit of risk. Guangzhou Automobile Group is currently generating about -0.03 per unit of risk. If you would invest 31.00 in Phoenix Motor Common on December 29, 2024 and sell it today you would earn a total of 7.00 from holding Phoenix Motor Common or generate 22.58% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 98.36% |
Values | Daily Returns |
Phoenix Motor Common vs. Guangzhou Automobile Group
Performance |
Timeline |
Phoenix Motor Common |
Guangzhou Automobile |
Phoenix and Guangzhou Automobile Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Phoenix and Guangzhou Automobile
The main advantage of trading using opposite Phoenix and Guangzhou Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Phoenix position performs unexpectedly, Guangzhou Automobile 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 Guangzhou Automobile will offset losses from the drop in Guangzhou Automobile's long position.Phoenix vs. GreenPower Motor | Phoenix vs. Envirotech Vehicles | Phoenix vs. Volcon Inc | Phoenix vs. Zapp Electric Vehicles |
Guangzhou Automobile vs. Xpeng Inc | Guangzhou Automobile vs. Tesla Inc | Guangzhou Automobile vs. Li Auto | Guangzhou Automobile vs. Rivian Automotive |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
Content Syndication Quickly integrate customizable finance content to your own investment portal | |
Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
Analyst Advice Analyst recommendations and target price estimates broken down by several categories | |
Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
Sync Your Broker Sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors. |