Correlation Between Shenzhen Topway and Invengo Information
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By analyzing existing cross correlation between Shenzhen Topway Video and Invengo Information Technology, you can compare the effects of market volatilities on Shenzhen Topway and Invengo Information 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 Invengo Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Topway and Invengo Information.
Diversification Opportunities for Shenzhen Topway and Invengo Information
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shenzhen and Invengo is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Topway Video and Invengo Information Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Invengo Information 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 Invengo Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Invengo Information has no effect on the direction of Shenzhen Topway i.e., Shenzhen Topway and Invengo Information go up and down completely randomly.
Pair Corralation between Shenzhen Topway and Invengo Information
Assuming the 90 days trading horizon Shenzhen Topway is expected to generate 1.66 times less return on investment than Invengo Information. But when comparing it to its historical volatility, Shenzhen Topway Video is 1.07 times less risky than Invengo Information. It trades about 0.14 of its potential returns per unit of risk. Invengo Information Technology is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 502.00 in Invengo Information Technology on November 7, 2024 and sell it today you would earn a total of 44.00 from holding Invengo Information Technology or generate 8.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Topway Video vs. Invengo Information Technology
Performance |
| Timeline |
| Shenzhen Topway Video |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Invengo Information |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Shenzhen Topway and Invengo Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Topway and Invengo Information
The main advantage of trading using opposite Shenzhen Topway and Invengo Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Topway position performs unexpectedly, Invengo Information 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 Invengo Information will offset losses from the drop in Invengo Information's long position.The idea behind Shenzhen Topway Video and Invengo Information 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.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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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