Correlation Between Wuxi Chemical and Songz Automobile
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By analyzing existing cross correlation between Wuxi Chemical Equipment and Songz Automobile Air, you can compare the effects of market volatilities on Wuxi Chemical and Songz Automobile 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 Wuxi Chemical with a short position of Songz Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wuxi Chemical and Songz Automobile.
Diversification Opportunities for Wuxi Chemical and Songz Automobile
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Wuxi and Songz is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Wuxi Chemical Equipment and Songz Automobile Air in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Songz Automobile Air and Wuxi Chemical 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 Wuxi Chemical Equipment are associated (or correlated) with Songz Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Songz Automobile Air has no effect on the direction of Wuxi Chemical i.e., Wuxi Chemical and Songz Automobile go up and down completely randomly.
Pair Corralation between Wuxi Chemical and Songz Automobile
Assuming the 90 days trading horizon Wuxi Chemical Equipment is expected to under-perform the Songz Automobile. In addition to that, Wuxi Chemical is 1.1 times more volatile than Songz Automobile Air. It trades about -0.01 of its total potential returns per unit of risk. Songz Automobile Air is currently generating about -0.01 per unit of volatility. If you would invest 815.00 in Songz Automobile Air on October 31, 2024 and sell it today you would lose (146.00) from holding Songz Automobile Air or give up 17.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wuxi Chemical Equipment vs. Songz Automobile Air
Performance |
| Timeline |
| Wuxi Chemical Equipment |
| Songz Automobile Air |
Wuxi Chemical and Songz Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wuxi Chemical and Songz Automobile
The main advantage of trading using opposite Wuxi Chemical and Songz Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wuxi Chemical position performs unexpectedly, Songz Automobile 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 Songz Automobile will offset losses from the drop in Songz Automobile's long position.| Wuxi Chemical vs. Fuzhou Rockchip Electronics | Wuxi Chemical vs. Ziel Home Furnishing | Wuxi Chemical vs. Dongguan Tarry Electronics | Wuxi Chemical vs. Hunan Mendale Hometextile |
| Songz Automobile vs. Jiangsu Hoperun Software | Songz Automobile vs. Hangzhou Pinming Software | Songz Automobile vs. Inspur Software Co | Songz Automobile vs. Thunder Software Technology |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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