Correlation Between Shenzhen Hifuture and Olympic Circuit
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By analyzing existing cross correlation between Shenzhen Hifuture Electric and Olympic Circuit Technology, you can compare the effects of market volatilities on Shenzhen Hifuture and Olympic Circuit 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 Shenzhen Hifuture with a short position of Olympic Circuit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Hifuture and Olympic Circuit.
Diversification Opportunities for Shenzhen Hifuture and Olympic Circuit
-0.1 | Correlation Coefficient |
Good diversification
The 3 months correlation between Shenzhen and Olympic is -0.1. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Hifuture Electric and Olympic Circuit Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Olympic Circuit Tech and Shenzhen Hifuture 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 Shenzhen Hifuture Electric are associated (or correlated) with Olympic Circuit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Olympic Circuit Tech has no effect on the direction of Shenzhen Hifuture i.e., Shenzhen Hifuture and Olympic Circuit go up and down completely randomly.
Pair Corralation between Shenzhen Hifuture and Olympic Circuit
Assuming the 90 days trading horizon Shenzhen Hifuture is expected to generate 6.79 times less return on investment than Olympic Circuit. In addition to that, Shenzhen Hifuture is 1.01 times more volatile than Olympic Circuit Technology. It trades about 0.02 of its total potential returns per unit of risk. Olympic Circuit Technology is currently generating about 0.13 per unit of volatility. If you would invest 1,758 in Olympic Circuit Technology on August 28, 2024 and sell it today you would earn a total of 1,300 from holding Olympic Circuit Technology or generate 73.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 99.17% |
| Values | Daily Returns |
Shenzhen Hifuture Electric vs. Olympic Circuit Technology
Performance |
| Timeline |
| Shenzhen Hifuture |
| Olympic Circuit Tech |
Shenzhen Hifuture and Olympic Circuit Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Hifuture and Olympic Circuit
The main advantage of trading using opposite Shenzhen Hifuture and Olympic Circuit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Hifuture position performs unexpectedly, Olympic Circuit 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 Olympic Circuit will offset losses from the drop in Olympic Circuit's long position.The idea behind Shenzhen Hifuture Electric and Olympic Circuit Technology pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Olympic Circuit vs. Nanjing Putian Telecommunications | Olympic Circuit vs. Shenzhen Hifuture Electric | Olympic Circuit vs. Shenyang Huitian Thermal | Olympic Circuit vs. Jiangsu Xinning Modern |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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