Correlation Between Toyota and Great Wall
Can any of the company-specific risk be diversified away by investing in both Toyota and Great Wall 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 Toyota and Great Wall into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Toyota Motor Corp and Great Wall Motor, you can compare the effects of market volatilities on Toyota and Great Wall 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 Toyota with a short position of Great Wall. Check out your portfolio center. Please also check ongoing floating volatility patterns of Toyota and Great Wall.
Diversification Opportunities for Toyota and Great Wall
-0.31 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Toyota and Great is -0.31. Overlapping area represents the amount of risk that can be diversified away by holding Toyota Motor Corp and Great Wall Motor in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Great Wall Motor and Toyota 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 Toyota Motor Corp are associated (or correlated) with Great Wall. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Great Wall Motor has no effect on the direction of Toyota i.e., Toyota and Great Wall go up and down completely randomly.
Pair Corralation between Toyota and Great Wall
Assuming the 90 days horizon Toyota Motor Corp is expected to generate 1.44 times more return on investment than Great Wall. However, Toyota is 1.44 times more volatile than Great Wall Motor. It trades about -0.06 of its potential returns per unit of risk. Great Wall Motor is currently generating about -0.26 per unit of risk. If you would invest 2,002 in Toyota Motor Corp on September 9, 2025 and sell it today you would lose (58.00) from holding Toyota Motor Corp or give up 2.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Toyota Motor Corp vs. Great Wall Motor
Performance |
| Timeline |
| Toyota Motor Corp |
| Great Wall Motor |
Toyota and Great Wall Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Toyota and Great Wall
The main advantage of trading using opposite Toyota and Great Wall positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Toyota position performs unexpectedly, Great Wall 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 Great Wall will offset losses from the drop in Great Wall's long position.| Toyota vs. Hermes International SA | Toyota vs. Hermes International SCA | Toyota vs. Volkswagen AG 110 | Toyota vs. Volkswagen AG Pref |
| Great Wall vs. Geely Automobile Holdings | Great Wall vs. Compagnie Generale des | Great Wall vs. Suzuki Motor | Great Wall vs. Suzuki Motor Corp |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
Other Complementary Tools
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules | |
| Money Managers Screen money managers from public funds and ETFs managed around the world | |
| AI Portfolio Prophet Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device |