This module allows you to analyze existing cross correlation between Caterpillar Inc and China Yuchai International Limited. You can compare the effects of market volatilities on Caterpillar and China Yuchai 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 Caterpillar with a short position of China Yuchai. See also your portfolio center
. Please also check ongoing floating volatility patterns of Caterpillar
and China Yuchai
Caterpillar Inc vs China Yuchai International Lim
Considering 30-days investment horizon, Caterpillar is expected to generate 2.22 times less return on investment than China Yuchai. But when comparing it to its historical volatility, Caterpillar Inc is 3.53 times less risky than China Yuchai. It trades about 0.49 of its potential returns per unit of risk. China Yuchai International Limited is currently generating about 0.31 of returns per unit of risk over similar time horizon. If you would invest 2,117 in China Yuchai International Limited on September 21, 2017 and sell it today you would earn a total of 249 from holding China Yuchai International Limited or generate 11.76% return on investment over 30 days.
|Time Period||1 Month [change]|
Very poor diversification
Overlapping area represents the amount of risk that can be diversified away by holding Caterpillar Inc and China Yuchai International Lim in the same portfolio assuming nothing else is changed. The correlation between historical prices or returns on China Yuchai Interna and Caterpillar 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 Caterpillar Inc are associated (or correlated) with China Yuchai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Yuchai Interna has no effect on the direction of Caterpillar i.e. Caterpillar and China Yuchai go up and down completely randomly.
Compared to the overall equity markets, risk-adjusted returns on investments in Caterpillar Inc are ranked lower than 33 (%) of all global equities and portfolios over the last 30 days.
Compared to the overall equity markets, risk-adjusted returns on investments in China Yuchai International Limited are ranked lower than 20 (%) of all global equities and portfolios over the last 30 days.