Correlation Between Progate and CHINA DEVELOPMENT
Can any of the company-specific risk be diversified away by investing in both Progate and CHINA DEVELOPMENT 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 Progate and CHINA DEVELOPMENT into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Progate Group and CHINA DEVELOPMENT FINANCIAL, you can compare the effects of market volatilities on Progate and CHINA DEVELOPMENT 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 Progate with a short position of CHINA DEVELOPMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of Progate and CHINA DEVELOPMENT.
Diversification Opportunities for Progate and CHINA DEVELOPMENT
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Progate and CHINA is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Progate Group and CHINA DEVELOPMENT FINANCIAL in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CHINA DEVELOPMENT and Progate 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 Progate Group are associated (or correlated) with CHINA DEVELOPMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CHINA DEVELOPMENT has no effect on the direction of Progate i.e., Progate and CHINA DEVELOPMENT go up and down completely randomly.
Pair Corralation between Progate and CHINA DEVELOPMENT
Assuming the 90 days trading horizon Progate Group is expected to under-perform the CHINA DEVELOPMENT. In addition to that, Progate is 5.43 times more volatile than CHINA DEVELOPMENT FINANCIAL. It trades about -0.07 of its total potential returns per unit of risk. CHINA DEVELOPMENT FINANCIAL is currently generating about 0.19 per unit of volatility. If you would invest 738.00 in CHINA DEVELOPMENT FINANCIAL on September 6, 2024 and sell it today you would earn a total of 42.00 from holding CHINA DEVELOPMENT FINANCIAL or generate 5.69% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Progate Group vs. CHINA DEVELOPMENT FINANCIAL
Performance |
Timeline |
Progate Group |
CHINA DEVELOPMENT |
Progate and CHINA DEVELOPMENT Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Progate and CHINA DEVELOPMENT
The main advantage of trading using opposite Progate and CHINA DEVELOPMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Progate position performs unexpectedly, CHINA DEVELOPMENT 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 CHINA DEVELOPMENT will offset losses from the drop in CHINA DEVELOPMENT's long position.Progate vs. Taiwan Semiconductor Manufacturing | Progate vs. Hon Hai Precision | Progate vs. MediaTek | Progate vs. Chunghwa Telecom Co |
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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 Equity Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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