Correlation Between Southern PublishingMedia and CIMC Vehicles
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By analyzing existing cross correlation between Southern PublishingMedia Co and CIMC Vehicles Co, you can compare the effects of market volatilities on Southern PublishingMedia and CIMC Vehicles 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 Southern PublishingMedia with a short position of CIMC Vehicles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Southern PublishingMedia and CIMC Vehicles.
Diversification Opportunities for Southern PublishingMedia and CIMC Vehicles
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Southern and CIMC is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Southern PublishingMedia Co and CIMC Vehicles Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIMC Vehicles and Southern PublishingMedia 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 Southern PublishingMedia Co are associated (or correlated) with CIMC Vehicles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIMC Vehicles has no effect on the direction of Southern PublishingMedia i.e., Southern PublishingMedia and CIMC Vehicles go up and down completely randomly.
Pair Corralation between Southern PublishingMedia and CIMC Vehicles
Assuming the 90 days trading horizon Southern PublishingMedia Co is expected to generate 1.03 times more return on investment than CIMC Vehicles. However, Southern PublishingMedia is 1.03 times more volatile than CIMC Vehicles Co. It trades about 0.13 of its potential returns per unit of risk. CIMC Vehicles Co is currently generating about 0.1 per unit of risk. If you would invest 1,255 in Southern PublishingMedia Co on September 11, 2024 and sell it today you would earn a total of 324.00 from holding Southern PublishingMedia Co or generate 25.82% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Southern PublishingMedia Co vs. CIMC Vehicles Co
Performance |
Timeline |
Southern PublishingMedia |
CIMC Vehicles |
Southern PublishingMedia and CIMC Vehicles Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Southern PublishingMedia and CIMC Vehicles
The main advantage of trading using opposite Southern PublishingMedia and CIMC Vehicles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Southern PublishingMedia position performs unexpectedly, CIMC Vehicles 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 CIMC Vehicles will offset losses from the drop in CIMC Vehicles' long position.The idea behind Southern PublishingMedia Co and CIMC Vehicles Co 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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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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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