Correlation Between China New and Costco Wholesale
Can any of the company-specific risk be diversified away by investing in both China New and Costco Wholesale 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 China New and Costco Wholesale into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China New Borun and Costco Wholesale Corp, you can compare the effects of market volatilities on China New and Costco Wholesale 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 China New with a short position of Costco Wholesale. Check out your portfolio center. Please also check ongoing floating volatility patterns of China New and Costco Wholesale.
Diversification Opportunities for China New and Costco Wholesale
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between China and Costco is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding China New Borun and Costco Wholesale Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Costco Wholesale Corp and China New 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 China New Borun are associated (or correlated) with Costco Wholesale. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Costco Wholesale Corp has no effect on the direction of China New i.e., China New and Costco Wholesale go up and down completely randomly.
Pair Corralation between China New and Costco Wholesale
If you would invest 67,890 in Costco Wholesale Corp on January 25, 2024 and sell it today you would earn a total of 4,378 from holding Costco Wholesale Corp or generate 6.45% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Flat |
Strength | Insignificant |
Accuracy | 0.0% |
Values | Daily Returns |
China New Borun vs. Costco Wholesale Corp
Performance |
Timeline |
China New Borun |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Costco Wholesale Corp |
China New and Costco Wholesale Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with China New and Costco Wholesale
The main advantage of trading using opposite China New and Costco Wholesale positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China New position performs unexpectedly, Costco Wholesale 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 Costco Wholesale will offset losses from the drop in Costco Wholesale's long position.China New vs. Park City Group | China New vs. Bill Com Holdings | China New vs. Asure Software | China New vs. VirnetX Holding Corp |
Costco Wholesale vs. Big Lots | Costco Wholesale vs. Aquagold International | Costco Wholesale vs. Thrivent High Yield | Costco Wholesale vs. Morningstar Unconstrained Allocation |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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