Correlation Between CardieX and China Senior

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Can any of the company-specific risk be diversified away by investing in both CardieX and China Senior 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 CardieX and China Senior into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CardieX Limited and China Senior Living, you can compare the effects of market volatilities on CardieX and China Senior 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 CardieX with a short position of China Senior. Check out your portfolio center. Please also check ongoing floating volatility patterns of CardieX and China Senior.

Diversification Opportunities for CardieX and China Senior

0.0
  Correlation Coefficient

Pay attention - limited upside

The 3 months correlation between CardieX and China is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding CardieX Limited and China Senior Living in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Senior Living and CardieX 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 CardieX Limited are associated (or correlated) with China Senior. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Senior Living has no effect on the direction of CardieX i.e., CardieX and China Senior go up and down completely randomly.

Pair Corralation between CardieX and China Senior

If you would invest  0.10  in China Senior Living on December 30, 2023 and sell it today you would earn a total of  0.00  from holding China Senior Living or generate 0.0% return on investment over 90 days.
Time Period3 Months [change]
DirectionFlat 
StrengthInsignificant
Accuracy0.0%
ValuesDaily Returns

CardieX Limited  vs.  China Senior Living

 Performance 
       Timeline  
CardieX Limited 

Risk-Adjusted Performance

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High
Very Weak
Over the last 90 days CardieX Limited has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable technical indicators, CardieX is not utilizing all of its potentials. The recent stock price disturbance, may contribute to mid-run losses for the stockholders.
China Senior Living 

Risk-Adjusted Performance

0 of 100

 
Low
 
High
Very Weak
Over the last 90 days China Senior Living has generated negative risk-adjusted returns adding no value to investors with long positions. Despite quite persistent basic indicators, China Senior is not utilizing all of its potentials. The newest stock price mess, may contribute to short-term losses for the institutional investors.

CardieX and China Senior Volatility Contrast

   Predicted Return Density   
       Returns  

Pair Trading with CardieX and China Senior

The main advantage of trading using opposite CardieX and China Senior positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CardieX position performs unexpectedly, China Senior 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 Senior will offset losses from the drop in China Senior's long position.
The idea behind CardieX Limited and China Senior Living 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.

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