Correlation Between GEELY AUTOMOBILE and CI GAMES

Can any of the company-specific risk be diversified away by investing in both GEELY AUTOMOBILE and CI GAMES 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 GEELY AUTOMOBILE and CI GAMES into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between GEELY AUTOMOBILE and CI GAMES SA, you can compare the effects of market volatilities on GEELY AUTOMOBILE and CI GAMES 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 GEELY AUTOMOBILE with a short position of CI GAMES. Check out your portfolio center. Please also check ongoing floating volatility patterns of GEELY AUTOMOBILE and CI GAMES.

Diversification Opportunities for GEELY AUTOMOBILE and CI GAMES

0.74

Correlation Coefficient

GEELY AUTOMOBILE  CI GAMES

Poor diversification

The 3 months correlation between GEELY and CI7 is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding GEELY AUTOMOBILE and CI GAMES SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CI GAMES SA and GEELY AUTOMOBILE 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 GEELY AUTOMOBILE are associated (or correlated) with CI GAMES. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CI GAMES SA has no effect on the direction of GEELY AUTOMOBILE i.e., GEELY AUTOMOBILE and CI GAMES go up and down completely randomly.

Pair Corralation between GEELY AUTOMOBILE and CI GAMES

Assuming the 90 days trading horizon GEELY AUTOMOBILE is expected to generate 1.53 times less return on investment than CI GAMES. But when comparing it to its historical volatility, GEELY AUTOMOBILE is 1.08 times less risky than CI GAMES. It trades about 0.18 of its potential returns per unit of risk. CI GAMES SA is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest  36.00  in CI GAMES SA on April 20, 2025 and sell it today you would earn a total of  24.00  from holding CI GAMES SA or generate 66.67% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

GEELY AUTOMOBILE  vs.  CI GAMES SA

GEELY AUTOMOBILE

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in GEELY AUTOMOBILE are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, GEELY AUTOMOBILE unveiled solid returns over the last few months and may actually be approaching a breakup point.

CI GAMES SA

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in CI GAMES SA are ranked lower than 19 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, CI GAMES reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with GEELY AUTOMOBILE and CI GAMES

The main advantage of trading using opposite GEELY AUTOMOBILE and CI GAMES positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GEELY AUTOMOBILE position performs unexpectedly, CI GAMES 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 CI GAMES will offset losses from the drop in CI GAMES's long position.

The idea behind GEELY AUTOMOBILE and CI GAMES SA 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.