Correlation Between ChengDu Hi and Ming Yang
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By analyzing existing cross correlation between ChengDu Hi Tech Development and Ming Yang Smart, you can compare the effects of market volatilities on ChengDu Hi 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 ChengDu Hi with a short position of Ming Yang. Check out your portfolio center. Please also check ongoing floating volatility patterns of ChengDu Hi and Ming Yang.
Diversification Opportunities for ChengDu Hi and Ming Yang
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between ChengDu and Ming is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding ChengDu Hi Tech Development 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 ChengDu Hi 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 ChengDu Hi Tech Development 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 ChengDu Hi i.e., ChengDu Hi and Ming Yang go up and down completely randomly.
Pair Corralation between ChengDu Hi and Ming Yang
Assuming the 90 days trading horizon ChengDu Hi Tech Development is expected to generate 1.32 times more return on investment than Ming Yang. However, ChengDu Hi is 1.32 times more volatile than Ming Yang Smart. It trades about 0.08 of its potential returns per unit of risk. Ming Yang Smart is currently generating about 0.04 per unit of risk. If you would invest 4,337 in ChengDu Hi Tech Development on October 25, 2024 and sell it today you would earn a total of 1,380 from holding ChengDu Hi Tech Development or generate 31.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ChengDu Hi Tech Development vs. Ming Yang Smart
Performance |
| Timeline |
| ChengDu Hi Tech |
| Ming Yang Smart |
ChengDu Hi and Ming Yang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ChengDu Hi and Ming Yang
The main advantage of trading using opposite ChengDu Hi and Ming Yang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ChengDu Hi 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.| ChengDu Hi vs. Youngy Health Co | ChengDu Hi vs. Yunnan Jianzhijia Health Chain | ChengDu Hi vs. Healthcare Co | ChengDu Hi vs. PKU HealthCare Corp |
| Ming Yang vs. Shanghai Broadband Technology | Ming Yang vs. Quectel Wireless Solutions | Ming Yang vs. Shaanxi Broadcast TV | Ming Yang vs. Sichuan Fulin Transportation |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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