Correlation Between CBAK Energy and ESS Tech
Can any of the company-specific risk be diversified away by investing in both CBAK Energy and ESS Tech 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 CBAK Energy and ESS Tech into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between CBAK Energy Technology and ESS Tech, you can compare the effects of market volatilities on CBAK Energy and ESS Tech 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 CBAK Energy with a short position of ESS Tech. Check out your portfolio center. Please also check ongoing floating volatility patterns of CBAK Energy and ESS Tech.
Diversification Opportunities for CBAK Energy and ESS Tech
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between CBAK and ESS is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding CBAK Energy Technology and ESS Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ESS Tech and CBAK Energy 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 CBAK Energy Technology are associated (or correlated) with ESS Tech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ESS Tech has no effect on the direction of CBAK Energy i.e., CBAK Energy and ESS Tech go up and down completely randomly.
Pair Corralation between CBAK Energy and ESS Tech
Given the investment horizon of 90 days CBAK Energy is expected to generate 75.33 times less return on investment than ESS Tech. But when comparing it to its historical volatility, CBAK Energy Technology is 5.78 times less risky than ESS Tech. It trades about 0.01 of its potential returns per unit of risk. ESS Tech is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 221.00 in ESS Tech on July 24, 2025 and sell it today you would earn a total of 212.00 from holding ESS Tech or generate 95.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
CBAK Energy Technology vs. ESS Tech
Performance |
| Timeline |
| CBAK Energy Technology |
| ESS Tech |
CBAK Energy and ESS Tech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CBAK Energy and ESS Tech
The main advantage of trading using opposite CBAK Energy and ESS Tech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CBAK Energy position performs unexpectedly, ESS Tech 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 ESS Tech will offset losses from the drop in ESS Tech's long position.| CBAK Energy vs. Ocean Power Technologies | CBAK Energy vs. ESS Tech | CBAK Energy vs. Flux Power Holdings | CBAK Energy vs. Espey Mfg Electronics |
| ESS Tech vs. Ocean Power Technologies | ESS Tech vs. Chardan NexTech Acquisition | ESS Tech vs. CBAK Energy Technology | ESS Tech vs. Espey Mfg Electronics |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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