Correlation Between Shenzhen Centralcon and Gem Year
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By analyzing existing cross correlation between Shenzhen Centralcon Investment and Gem Year Industrial Co, you can compare the effects of market volatilities on Shenzhen Centralcon and Gem Year 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 Shenzhen Centralcon with a short position of Gem Year. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Centralcon and Gem Year.
Diversification Opportunities for Shenzhen Centralcon and Gem Year
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shenzhen and Gem is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Centralcon Investment and Gem Year Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gem Year Industrial and Shenzhen Centralcon 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 Shenzhen Centralcon Investment are associated (or correlated) with Gem Year. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gem Year Industrial has no effect on the direction of Shenzhen Centralcon i.e., Shenzhen Centralcon and Gem Year go up and down completely randomly.
Pair Corralation between Shenzhen Centralcon and Gem Year
Assuming the 90 days trading horizon Shenzhen Centralcon Investment is expected to generate 1.19 times more return on investment than Gem Year. However, Shenzhen Centralcon is 1.19 times more volatile than Gem Year Industrial Co. It trades about 0.15 of its potential returns per unit of risk. Gem Year Industrial Co is currently generating about -0.05 per unit of risk. If you would invest 507.00 in Shenzhen Centralcon Investment on September 5, 2024 and sell it today you would earn a total of 35.00 from holding Shenzhen Centralcon Investment or generate 6.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Shenzhen Centralcon Investment vs. Gem Year Industrial Co
Performance |
| Timeline |
| Shenzhen Centralcon |
| Gem Year Industrial |
Shenzhen Centralcon and Gem Year Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Centralcon and Gem Year
The main advantage of trading using opposite Shenzhen Centralcon and Gem Year positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Centralcon position performs unexpectedly, Gem Year 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 Gem Year will offset losses from the drop in Gem Year's long position.The idea behind Shenzhen Centralcon Investment and Gem Year Industrial Co 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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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.
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