Correlation Between CNFinance Holdings and Dorman Products

Can any of the company-specific risk be diversified away by investing in both CNFinance Holdings and Dorman Products 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 CNFinance Holdings and Dorman Products into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between CNFinance Holdings and Dorman Products, you can compare the effects of market volatilities on CNFinance Holdings and Dorman Products 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 CNFinance Holdings with a short position of Dorman Products. Check out your portfolio center. Please also check ongoing floating volatility patterns of CNFinance Holdings and Dorman Products.

Diversification Opportunities for CNFinance Holdings and Dorman Products

-0.78

Correlation Coefficient

CNFinance Holdings  Dorman Products

Pay attention - limited upside

The 3 months correlation between CNFinance and Dorman is -0.78. Overlapping area represents the amount of risk that can be diversified away by holding CNFinance Holdings and Dorman Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dorman Products and CNFinance Holdings 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 CNFinance Holdings are associated (or correlated) with Dorman Products. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dorman Products has no effect on the direction of CNFinance Holdings i.e., CNFinance Holdings and Dorman Products go up and down completely randomly.

Pair Corralation between CNFinance Holdings and Dorman Products

Considering the 90-day investment horizon CNFinance Holdings is expected to generate 4.65 times less return on investment than Dorman Products. In addition to that, CNFinance Holdings is 5.99 times more volatile than Dorman Products. It trades about 0.01 of its total potential returns per unit of risk. Dorman Products is currently generating about 0.16 per unit of volatility. If you would invest  12,186  in Dorman Products on July 29, 2025 and sell it today you would earn a total of  3,189  from holding Dorman Products or generate 26.17% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Weak
Accuracy	98.46%
Values	Daily Returns

CNFinance Holdings  vs.  Dorman Products

CNFinance Holdings

Risk-Adjusted Performance

Weakest

Over the last 90 days CNFinance Holdings has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, CNFinance Holdings is not utilizing all of its potentials. The latest stock price disturbance, may contribute to mid-run losses for the stockholders.

Dorman Products

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Dorman Products are ranked lower than 12 (%) of all global equities and portfolios over the last 90 days. In spite of very abnormal basic indicators, Dorman Products displayed solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with CNFinance Holdings and Dorman Products

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

The idea behind CNFinance Holdings and Dorman Products 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.