Correlation Between Beijing Yanjing and Union Semiconductor
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By analyzing existing cross correlation between Beijing Yanjing Brewery and Union Semiconductor Co, you can compare the effects of market volatilities on Beijing Yanjing and Union Semiconductor 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 Beijing Yanjing with a short position of Union Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Yanjing and Union Semiconductor.
Diversification Opportunities for Beijing Yanjing and Union Semiconductor
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Beijing and Union is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Yanjing Brewery and Union Semiconductor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Union Semiconductor and Beijing Yanjing 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 Beijing Yanjing Brewery are associated (or correlated) with Union Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Union Semiconductor has no effect on the direction of Beijing Yanjing i.e., Beijing Yanjing and Union Semiconductor go up and down completely randomly.
Pair Corralation between Beijing Yanjing and Union Semiconductor
Assuming the 90 days trading horizon Beijing Yanjing is expected to generate 2.85 times less return on investment than Union Semiconductor. But when comparing it to its historical volatility, Beijing Yanjing Brewery is 1.59 times less risky than Union Semiconductor. It trades about 0.05 of its potential returns per unit of risk. Union Semiconductor Co is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 891.00 in Union Semiconductor Co on September 5, 2024 and sell it today you would earn a total of 41.00 from holding Union Semiconductor Co or generate 4.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Yanjing Brewery vs. Union Semiconductor Co
Performance |
| Timeline |
| Beijing Yanjing Brewery |
| Union Semiconductor |
Beijing Yanjing and Union Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Yanjing and Union Semiconductor
The main advantage of trading using opposite Beijing Yanjing and Union Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Yanjing position performs unexpectedly, Union Semiconductor 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 Union Semiconductor will offset losses from the drop in Union Semiconductor's long position.| Beijing Yanjing vs. Super Dragon Engineering Plastics | Beijing Yanjing vs. Ningbo Tip Rubber | Beijing Yanjing vs. Jiangnan Mould Plastic | Beijing Yanjing vs. Renxin New Material |
| Union Semiconductor vs. Dongguan Tarry Electronics | Union Semiconductor vs. Beijing Yanjing Brewery | Union Semiconductor vs. Integrated Electronic Systems | Union Semiconductor vs. Haima Automobile Group |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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