Correlation Between Central Plains and Wuxi Chemical
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By analyzing existing cross correlation between Central Plains Environment and Wuxi Chemical Equipment, you can compare the effects of market volatilities on Central Plains and Wuxi Chemical 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 Central Plains with a short position of Wuxi Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Central Plains and Wuxi Chemical.
Diversification Opportunities for Central Plains and Wuxi Chemical
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Central and Wuxi is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Central Plains Environment and Wuxi Chemical Equipment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wuxi Chemical Equipment and Central Plains 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 Central Plains Environment are associated (or correlated) with Wuxi Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wuxi Chemical Equipment has no effect on the direction of Central Plains i.e., Central Plains and Wuxi Chemical go up and down completely randomly.
Pair Corralation between Central Plains and Wuxi Chemical
Assuming the 90 days trading horizon Central Plains Environment is expected to generate 0.75 times more return on investment than Wuxi Chemical. However, Central Plains Environment is 1.33 times less risky than Wuxi Chemical. It trades about 0.06 of its potential returns per unit of risk. Wuxi Chemical Equipment is currently generating about 0.0 per unit of risk. If you would invest 594.00 in Central Plains Environment on September 3, 2024 and sell it today you would earn a total of 307.00 from holding Central Plains Environment or generate 51.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Central Plains Environment vs. Wuxi Chemical Equipment
Performance |
| Timeline |
| Central Plains Envir |
| Wuxi Chemical Equipment |
Central Plains and Wuxi Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Central Plains and Wuxi Chemical
The main advantage of trading using opposite Central Plains and Wuxi Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Central Plains position performs unexpectedly, Wuxi Chemical 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 Wuxi Chemical will offset losses from the drop in Wuxi Chemical's long position.| Central Plains vs. Cultural Investment Holdings | Central Plains vs. Gome Telecom Equipment | Central Plains vs. Bus Online Co | Central Plains vs. Holitech Technology Co |
| Wuxi Chemical vs. CITIC Guoan Information | Wuxi Chemical vs. Shenzhen SDG Information | Wuxi Chemical vs. Kangxin New Materials | Wuxi Chemical vs. Jinsanjiang Silicon Material |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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