Correlation Between Cenntro Electric and Reborn Coffee
Can any of the company-specific risk be diversified away by investing in both Cenntro Electric and Reborn Coffee 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 Cenntro Electric and Reborn Coffee into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Cenntro Electric Group and Reborn Coffee, you can compare the effects of market volatilities on Cenntro Electric and Reborn Coffee 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 Cenntro Electric with a short position of Reborn Coffee. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cenntro Electric and Reborn Coffee.
Diversification Opportunities for Cenntro Electric and Reborn Coffee
0.69 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cenntro and Reborn is 0.69. Overlapping area represents the amount of risk that can be diversified away by holding Cenntro Electric Group and Reborn Coffee in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Reborn Coffee and Cenntro Electric 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 Cenntro Electric Group are associated (or correlated) with Reborn Coffee. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Reborn Coffee has no effect on the direction of Cenntro Electric i.e., Cenntro Electric and Reborn Coffee go up and down completely randomly.
Pair Corralation between Cenntro Electric and Reborn Coffee
Given the investment horizon of 90 days Cenntro Electric Group is expected to under-perform the Reborn Coffee. But the stock apears to be less risky and, when comparing its historical volatility, Cenntro Electric Group is 1.75 times less risky than Reborn Coffee. The stock trades about -0.05 of its potential returns per unit of risk. The Reborn Coffee is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 408.00 in Reborn Coffee on August 28, 2025 and sell it today you would lose (219.00) from holding Reborn Coffee or give up 53.68% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cenntro Electric Group vs. Reborn Coffee
Performance |
| Timeline |
| Cenntro Electric |
| Reborn Coffee |
Cenntro Electric and Reborn Coffee Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cenntro Electric and Reborn Coffee
The main advantage of trading using opposite Cenntro Electric and Reborn Coffee positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cenntro Electric position performs unexpectedly, Reborn Coffee 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 Reborn Coffee will offset losses from the drop in Reborn Coffee's long position.| Cenntro Electric vs. SD Standard Drilling | Cenntro Electric vs. Cabo Drilling Corp | Cenntro Electric vs. PARKSON Retail Group | Cenntro Electric vs. Robinsons Retail Holdings |
| Reborn Coffee vs. Biglari Holdings | Reborn Coffee vs. Smart Share Global | Reborn Coffee vs. Ihuman Inc | Reborn Coffee vs. Premium Catering Limited |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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