Correlation Between QINGCI GAMES and CNVISION MEDIA

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

By analyzing existing cross correlation between QINGCI GAMES INC and CNVISION MEDIA, you can compare the effects of market volatilities on QINGCI GAMES and CNVISION MEDIA 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 QINGCI GAMES with a short position of CNVISION MEDIA. Check out your portfolio center. Please also check ongoing floating volatility patterns of QINGCI GAMES and CNVISION MEDIA.

Diversification Opportunities for QINGCI GAMES and CNVISION MEDIA

0.45

Correlation Coefficient

QINGCI GAMES  CNVISION MEDIA

Very weak diversification

The 3 months correlation between QINGCI and CNVISION is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding QINGCI GAMES INC and CNVISION MEDIA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CNVISION MEDIA and QINGCI GAMES 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 QINGCI GAMES INC are associated (or correlated) with CNVISION MEDIA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CNVISION MEDIA has no effect on the direction of QINGCI GAMES i.e., QINGCI GAMES and CNVISION MEDIA go up and down completely randomly.

Pair Corralation between QINGCI GAMES and CNVISION MEDIA

Assuming the 90 days horizon QINGCI GAMES INC is expected to generate 1.0 times more return on investment than CNVISION MEDIA. However, QINGCI GAMES is 1.0 times more volatile than CNVISION MEDIA. It trades about 0.37 of its potential returns per unit of risk. CNVISION MEDIA is currently generating about 0.11 per unit of risk. If you would invest  30.00  in QINGCI GAMES INC on October 16, 2024 and sell it today you would earn a total of  5.00  from holding QINGCI GAMES INC or generate 16.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Weak
Accuracy	94.12%
Values	Daily Returns

QINGCI GAMES INC  vs.  CNVISION MEDIA

QINGCI GAMES INC

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in QINGCI GAMES INC are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, QINGCI GAMES reported solid returns over the last few months and may actually be approaching a breakup point.

CNVISION MEDIA

Risk-Adjusted Performance

11 of 100

Good

Compared to the overall equity markets, risk-adjusted returns on investments in CNVISION MEDIA are ranked lower than 11 (%) of all global equities and portfolios over the last 90 days. In spite of rather uncertain basic indicators, CNVISION MEDIA exhibited solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with QINGCI GAMES and CNVISION MEDIA

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

The idea behind QINGCI GAMES INC and CNVISION MEDIA 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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.