Correlation Between SUNSEA Telecommunicatio and Guangdong Qunxing
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By analyzing existing cross correlation between SUNSEA Telecommunications Co and Guangdong Qunxing Toys, you can compare the effects of market volatilities on SUNSEA Telecommunicatio and Guangdong Qunxing 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 SUNSEA Telecommunicatio with a short position of Guangdong Qunxing. Check out your portfolio center. Please also check ongoing floating volatility patterns of SUNSEA Telecommunicatio and Guangdong Qunxing.
Diversification Opportunities for SUNSEA Telecommunicatio and Guangdong Qunxing
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between SUNSEA and Guangdong is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding SUNSEA Telecommunications Co and Guangdong Qunxing Toys in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Qunxing Toys and SUNSEA Telecommunicatio 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 SUNSEA Telecommunications Co are associated (or correlated) with Guangdong Qunxing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Qunxing Toys has no effect on the direction of SUNSEA Telecommunicatio i.e., SUNSEA Telecommunicatio and Guangdong Qunxing go up and down completely randomly.
Pair Corralation between SUNSEA Telecommunicatio and Guangdong Qunxing
Assuming the 90 days trading horizon SUNSEA Telecommunicatio is expected to generate 7.27 times less return on investment than Guangdong Qunxing. In addition to that, SUNSEA Telecommunicatio is 1.25 times more volatile than Guangdong Qunxing Toys. It trades about 0.0 of its total potential returns per unit of risk. Guangdong Qunxing Toys is currently generating about 0.03 per unit of volatility. If you would invest 610.00 in Guangdong Qunxing Toys on September 2, 2024 and sell it today you would earn a total of 75.00 from holding Guangdong Qunxing Toys or generate 12.3% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
SUNSEA Telecommunications Co vs. Guangdong Qunxing Toys
Performance |
| Timeline |
| SUNSEA Telecommunicatio |
| Guangdong Qunxing Toys |
SUNSEA Telecommunicatio and Guangdong Qunxing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SUNSEA Telecommunicatio and Guangdong Qunxing
The main advantage of trading using opposite SUNSEA Telecommunicatio and Guangdong Qunxing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SUNSEA Telecommunicatio position performs unexpectedly, Guangdong Qunxing 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 Guangdong Qunxing will offset losses from the drop in Guangdong Qunxing's long position.| SUNSEA Telecommunicatio vs. Industrial and Commercial | SUNSEA Telecommunicatio vs. Kweichow Moutai Co | SUNSEA Telecommunicatio vs. Agricultural Bank of | SUNSEA Telecommunicatio vs. China Mobile Limited |
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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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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