Correlation Between Changchun and Sichuan Yahua
Specify exactly 2 symbols:
By analyzing existing cross correlation between Changchun UP Optotech and Sichuan Yahua Industrial, you can compare the effects of market volatilities on Changchun and Sichuan Yahua 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 Changchun with a short position of Sichuan Yahua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun and Sichuan Yahua.
Diversification Opportunities for Changchun and Sichuan Yahua
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Changchun and Sichuan is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Changchun UP Optotech and Sichuan Yahua Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sichuan Yahua Industrial and Changchun 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 Changchun UP Optotech are associated (or correlated) with Sichuan Yahua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sichuan Yahua Industrial has no effect on the direction of Changchun i.e., Changchun and Sichuan Yahua go up and down completely randomly.
Pair Corralation between Changchun and Sichuan Yahua
Assuming the 90 days trading horizon Changchun UP Optotech is expected to generate 1.68 times more return on investment than Sichuan Yahua. However, Changchun is 1.68 times more volatile than Sichuan Yahua Industrial. It trades about 0.09 of its potential returns per unit of risk. Sichuan Yahua Industrial is currently generating about 0.14 per unit of risk. If you would invest 3,760 in Changchun UP Optotech on August 29, 2024 and sell it today you would earn a total of 304.00 from holding Changchun UP Optotech or generate 8.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun UP Optotech vs. Sichuan Yahua Industrial
Performance |
| Timeline |
| Changchun UP Optotech |
| Sichuan Yahua Industrial |
Changchun and Sichuan Yahua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun and Sichuan Yahua
The main advantage of trading using opposite Changchun and Sichuan Yahua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun position performs unexpectedly, Sichuan Yahua 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 Sichuan Yahua will offset losses from the drop in Sichuan Yahua's long position.| Changchun vs. PetroChina Co Ltd | Changchun vs. China State Construction | Changchun vs. China Mobile Limited | Changchun vs. Industrial and Commercial |
| Sichuan Yahua vs. Baoshan Iron Steel | Sichuan Yahua vs. Shandong Gold Mining | Sichuan Yahua vs. Rongsheng Petrochemical Co | Sichuan Yahua vs. Inner Mongolia BaoTou |
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 Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Other Complementary Tools
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated |