Correlation Between ChengDu Hi and Dawning Information
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By analyzing existing cross correlation between ChengDu Hi Tech Development and Dawning Information Industry, you can compare the effects of market volatilities on ChengDu Hi and Dawning Information 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 Dawning Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of ChengDu Hi and Dawning Information.
Diversification Opportunities for ChengDu Hi and Dawning Information
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between ChengDu and Dawning is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding ChengDu Hi Tech Development and Dawning Information Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dawning Information 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 Dawning Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dawning Information has no effect on the direction of ChengDu Hi i.e., ChengDu Hi and Dawning Information go up and down completely randomly.
Pair Corralation between ChengDu Hi and Dawning Information
Assuming the 90 days trading horizon ChengDu Hi Tech Development is expected to generate 0.76 times more return on investment than Dawning Information. However, ChengDu Hi Tech Development is 1.32 times less risky than Dawning Information. It trades about -0.11 of its potential returns per unit of risk. Dawning Information Industry is currently generating about -0.13 per unit of risk. If you would invest 6,727 in ChengDu Hi Tech Development on September 13, 2024 and sell it today you would lose (549.00) from holding ChengDu Hi Tech Development or give up 8.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
ChengDu Hi Tech Development vs. Dawning Information Industry
Performance |
| Timeline |
| ChengDu Hi Tech |
| Dawning Information |
ChengDu Hi and Dawning Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ChengDu Hi and Dawning Information
The main advantage of trading using opposite ChengDu Hi and Dawning Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ChengDu Hi position performs unexpectedly, Dawning Information 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 Dawning Information will offset losses from the drop in Dawning Information's long position.| ChengDu Hi vs. China Life Insurance | ChengDu Hi vs. Cinda Securities Co | ChengDu Hi vs. Piotech Inc A | ChengDu Hi vs. Dongxing Sec Co |
| Dawning Information vs. Dhc Software Co | Dawning Information vs. ChengDu Hi Tech Development | Dawning Information vs. Sinofibers Technology Co | Dawning Information vs. Qingdao Hi Tech Moulds |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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