Correlation Between Cofco Biochemical and DO Home
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By analyzing existing cross correlation between Cofco Biochemical Anhui and DO Home Collection, you can compare the effects of market volatilities on Cofco Biochemical and DO Home 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 Cofco Biochemical with a short position of DO Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cofco Biochemical and DO Home.
Diversification Opportunities for Cofco Biochemical and DO Home
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cofco and 002798 is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Cofco Biochemical Anhui and DO Home Collection in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DO Home Collection and Cofco Biochemical 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 Cofco Biochemical Anhui are associated (or correlated) with DO Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DO Home Collection has no effect on the direction of Cofco Biochemical i.e., Cofco Biochemical and DO Home go up and down completely randomly.
Pair Corralation between Cofco Biochemical and DO Home
Assuming the 90 days trading horizon Cofco Biochemical Anhui is expected to generate 0.24 times more return on investment than DO Home. However, Cofco Biochemical Anhui is 4.1 times less risky than DO Home. It trades about -0.41 of its potential returns per unit of risk. DO Home Collection is currently generating about -0.21 per unit of risk. If you would invest 592.00 in Cofco Biochemical Anhui on October 17, 2024 and sell it today you would lose (66.00) from holding Cofco Biochemical Anhui or give up 11.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cofco Biochemical Anhui vs. DO Home Collection
Performance |
| Timeline |
| Cofco Biochemical Anhui |
| DO Home Collection |
Cofco Biochemical and DO Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cofco Biochemical and DO Home
The main advantage of trading using opposite Cofco Biochemical and DO Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cofco Biochemical position performs unexpectedly, DO Home 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 DO Home will offset losses from the drop in DO Home's long position.| Cofco Biochemical vs. Chison Medical Technologies | Cofco Biochemical vs. Winner Medical Co | Cofco Biochemical vs. Eyebright Medical Technology | Cofco Biochemical vs. Kunwu Jiuding Investment |
| DO Home vs. Tangel Publishing | DO Home vs. FSPG Hi Tech Co | DO Home vs. Fiberhome Telecommunication Technologies | DO Home vs. Zhongshan Public Utilities |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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