Correlation Between Sportsoul and Chengdu Xingrong
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By analyzing existing cross correlation between Sportsoul Co Ltd and Chengdu Xingrong Investment, you can compare the effects of market volatilities on Sportsoul and Chengdu Xingrong 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 Sportsoul with a short position of Chengdu Xingrong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sportsoul and Chengdu Xingrong.
Diversification Opportunities for Sportsoul and Chengdu Xingrong
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sportsoul and Chengdu is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Sportsoul Co Ltd and Chengdu Xingrong Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chengdu Xingrong Inv and Sportsoul 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 Sportsoul Co Ltd are associated (or correlated) with Chengdu Xingrong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chengdu Xingrong Inv has no effect on the direction of Sportsoul i.e., Sportsoul and Chengdu Xingrong go up and down completely randomly.
Pair Corralation between Sportsoul and Chengdu Xingrong
Assuming the 90 days trading horizon Sportsoul is expected to generate 1.93 times less return on investment than Chengdu Xingrong. In addition to that, Sportsoul is 2.08 times more volatile than Chengdu Xingrong Investment. It trades about 0.02 of its total potential returns per unit of risk. Chengdu Xingrong Investment is currently generating about 0.06 per unit of volatility. If you would invest 465.00 in Chengdu Xingrong Investment on September 12, 2024 and sell it today you would earn a total of 248.00 from holding Chengdu Xingrong Investment or generate 53.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sportsoul Co Ltd vs. Chengdu Xingrong Investment
Performance |
| Timeline |
| Sportsoul |
| Chengdu Xingrong Inv |
Sportsoul and Chengdu Xingrong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sportsoul and Chengdu Xingrong
The main advantage of trading using opposite Sportsoul and Chengdu Xingrong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sportsoul position performs unexpectedly, Chengdu Xingrong 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 Chengdu Xingrong will offset losses from the drop in Chengdu Xingrong's long position.| Sportsoul vs. Lutian Machinery Co | Sportsoul vs. PetroChina Co Ltd | Sportsoul vs. Bank of China | Sportsoul vs. Gansu Jiu Steel |
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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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