Correlation Between Digital China and Ming Yang
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By analyzing existing cross correlation between Digital China Information and Ming Yang Smart, you can compare the effects of market volatilities on Digital China and Ming Yang 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 Ming Yang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Digital China and Ming Yang.
Diversification Opportunities for Digital China and Ming Yang
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Digital and Ming is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Digital China Information and Ming Yang Smart in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ming Yang Smart 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 Ming Yang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ming Yang Smart has no effect on the direction of Digital China i.e., Digital China and Ming Yang go up and down completely randomly.
Pair Corralation between Digital China and Ming Yang
Assuming the 90 days trading horizon Digital China Information is expected to generate 1.16 times more return on investment than Ming Yang. However, Digital China is 1.16 times more volatile than Ming Yang Smart. It trades about -0.12 of its potential returns per unit of risk. Ming Yang Smart is currently generating about -0.38 per unit of risk. If you would invest 1,183 in Digital China Information on October 29, 2024 and sell it today you would lose (87.00) from holding Digital China Information or give up 7.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Digital China Information vs. Ming Yang Smart
Performance |
| Timeline |
| Digital China Information |
| Ming Yang Smart |
Digital China and Ming Yang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Digital China and Ming Yang
The main advantage of trading using opposite Digital China and Ming Yang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Digital China position performs unexpectedly, Ming Yang 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 Ming Yang will offset losses from the drop in Ming Yang's long position.| Digital China vs. Jilin OLED Material | Digital China vs. China Building Material | Digital China vs. Jiahe Foods Industry | Digital China vs. New Hope Dairy |
| Ming Yang vs. Eyebright Medical Technology | Ming Yang vs. Anhui Fuhuang Steel | Ming Yang vs. Kangping Technology Co | Ming Yang vs. Jiujiang Shanshui Technology |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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