Correlation Between Digital China and Sany Heavy
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By analyzing existing cross correlation between Digital China Information and Sany Heavy Industry, you can compare the effects of market volatilities on Digital China and Sany Heavy 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 Digital China with a short position of Sany Heavy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Digital China and Sany Heavy.
Diversification Opportunities for Digital China and Sany Heavy
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Digital and Sany is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Digital China Information and Sany Heavy Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sany Heavy Industry and Digital China 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 Digital China Information are associated (or correlated) with Sany Heavy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sany Heavy Industry has no effect on the direction of Digital China i.e., Digital China and Sany Heavy go up and down completely randomly.
Pair Corralation between Digital China and Sany Heavy
Assuming the 90 days trading horizon Digital China Information is expected to generate 1.66 times more return on investment than Sany Heavy. However, Digital China is 1.66 times more volatile than Sany Heavy Industry. It trades about 0.03 of its potential returns per unit of risk. Sany Heavy Industry is currently generating about 0.01 per unit of risk. If you would invest 1,118 in Digital China Information on September 12, 2024 and sell it today you would earn a total of 122.00 from holding Digital China Information or generate 10.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Digital China Information vs. Sany Heavy Industry
Performance |
| Timeline |
| Digital China Information |
| Sany Heavy Industry |
Digital China and Sany Heavy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Digital China and Sany Heavy
The main advantage of trading using opposite Digital China and Sany Heavy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Digital China position performs unexpectedly, Sany Heavy 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 Sany Heavy will offset losses from the drop in Sany Heavy's long position.| Digital China vs. Gansu Jiu Steel | Digital China vs. Shandong Mining Machinery | Digital China vs. Aba Chemicals Corp | Digital China vs. BlueFocus Communication Group |
| Sany Heavy vs. Shanghai Action Education | Sany Heavy vs. Time Publishing and | Sany Heavy vs. Xinhua Winshare Publishing | Sany Heavy vs. Northern United Publishing |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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