Correlation Between Shenzhen Noposion and SUNSEA Telecommunicatio
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By analyzing existing cross correlation between Shenzhen Noposion Agrochemicals and SUNSEA Telecommunications Co, you can compare the effects of market volatilities on Shenzhen Noposion and SUNSEA Telecommunicatio 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 Noposion with a short position of SUNSEA Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Noposion and SUNSEA Telecommunicatio.
Diversification Opportunities for Shenzhen Noposion and SUNSEA Telecommunicatio
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shenzhen and SUNSEA is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Noposion Agrochemical and SUNSEA Telecommunications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUNSEA Telecommunicatio and Shenzhen Noposion 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 Noposion Agrochemicals are associated (or correlated) with SUNSEA Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SUNSEA Telecommunicatio has no effect on the direction of Shenzhen Noposion i.e., Shenzhen Noposion and SUNSEA Telecommunicatio go up and down completely randomly.
Pair Corralation between Shenzhen Noposion and SUNSEA Telecommunicatio
Assuming the 90 days trading horizon Shenzhen Noposion is expected to generate 1.04 times less return on investment than SUNSEA Telecommunicatio. But when comparing it to its historical volatility, Shenzhen Noposion Agrochemicals is 1.56 times less risky than SUNSEA Telecommunicatio. It trades about 0.07 of its potential returns per unit of risk. SUNSEA Telecommunications Co is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 743.00 in SUNSEA Telecommunications Co on August 28, 2024 and sell it today you would earn a total of 93.00 from holding SUNSEA Telecommunications Co or generate 12.52% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Shenzhen Noposion Agrochemical vs. SUNSEA Telecommunications Co
Performance |
Timeline |
Shenzhen Noposion |
SUNSEA Telecommunicatio |
Shenzhen Noposion and SUNSEA Telecommunicatio Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Shenzhen Noposion and SUNSEA Telecommunicatio
The main advantage of trading using opposite Shenzhen Noposion and SUNSEA Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Noposion position performs unexpectedly, SUNSEA Telecommunicatio 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 SUNSEA Telecommunicatio will offset losses from the drop in SUNSEA Telecommunicatio's long position.Shenzhen Noposion vs. Zijin Mining Group | Shenzhen Noposion vs. Wanhua Chemical Group | Shenzhen Noposion vs. Baoshan Iron Steel | Shenzhen Noposion vs. Shandong Gold Mining |
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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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