Correlation Between Shenzhen Topway and Weichai Heavy
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By analyzing existing cross correlation between Shenzhen Topway Video and Weichai Heavy Machinery, you can compare the effects of market volatilities on Shenzhen Topway and Weichai Heavy 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 Topway with a short position of Weichai Heavy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Topway and Weichai Heavy.
Diversification Opportunities for Shenzhen Topway and Weichai Heavy
-0.73 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Shenzhen and Weichai is -0.73. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Topway Video and Weichai Heavy Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Weichai Heavy Machinery and Shenzhen Topway 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 Topway Video are associated (or correlated) with Weichai Heavy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Weichai Heavy Machinery has no effect on the direction of Shenzhen Topway i.e., Shenzhen Topway and Weichai Heavy go up and down completely randomly.
Pair Corralation between Shenzhen Topway and Weichai Heavy
Assuming the 90 days trading horizon Shenzhen Topway is expected to generate 2.02 times less return on investment than Weichai Heavy. In addition to that, Shenzhen Topway is 1.15 times more volatile than Weichai Heavy Machinery. It trades about 0.03 of its total potential returns per unit of risk. Weichai Heavy Machinery is currently generating about 0.07 per unit of volatility. If you would invest 1,034 in Weichai Heavy Machinery on November 19, 2024 and sell it today you would earn a total of 1,268 from holding Weichai Heavy Machinery or generate 122.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Topway Video vs. Weichai Heavy Machinery
Performance |
| Timeline |
| Shenzhen Topway Video |
| Weichai Heavy Machinery |
Shenzhen Topway and Weichai Heavy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Topway and Weichai Heavy
The main advantage of trading using opposite Shenzhen Topway and Weichai Heavy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Topway position performs unexpectedly, Weichai Heavy 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 Weichai Heavy will offset losses from the drop in Weichai Heavy's long position.| Shenzhen Topway vs. Huatian Hotel Group | Shenzhen Topway vs. Kontour Medical Technology | Shenzhen Topway vs. Sichuan Hebang Biotechnology | Shenzhen Topway vs. Jinhe Biotechnology Co |
| Weichai Heavy vs. Yuanjie Semiconductor Technology | Weichai Heavy vs. Tieling Newcity Investment | Weichai Heavy vs. Hubei Geoway Investment | Weichai Heavy vs. Jiangsu Yueda Investment |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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