Correlation Between Changchun and Ming Yang
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By analyzing existing cross correlation between Changchun UP Optotech and Ming Yang Smart, you can compare the effects of market volatilities on Changchun and Ming Yang 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 Ming Yang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun and Ming Yang.
Diversification Opportunities for Changchun and Ming Yang
Poor diversification
The 3 months correlation between Changchun and Ming is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Changchun UP Optotech and Ming Yang Smart in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ming Yang Smart 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 Ming Yang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ming Yang Smart has no effect on the direction of Changchun i.e., Changchun and Ming Yang go up and down completely randomly.
Pair Corralation between Changchun and Ming Yang
Assuming the 90 days trading horizon Changchun UP Optotech is expected to generate 1.02 times more return on investment than Ming Yang. However, Changchun is 1.02 times more volatile than Ming Yang Smart. It trades about -0.39 of its potential returns per unit of risk. Ming Yang Smart is currently generating about -0.6 per unit of risk. If you would invest 4,270 in Changchun UP Optotech on October 8, 2024 and sell it today you would lose (721.00) from holding Changchun UP Optotech or give up 16.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun UP Optotech vs. Ming Yang Smart
Performance |
| Timeline |
| Changchun UP Optotech |
| Ming Yang Smart |
Changchun and Ming Yang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun and Ming Yang
The main advantage of trading using opposite Changchun and Ming Yang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun position performs unexpectedly, Ming Yang 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 Ming Yang will offset losses from the drop in Ming Yang's long position.| Changchun vs. Cloud Live Technology | Changchun vs. Nanjing Putian Telecommunications | Changchun vs. Tianjin Realty Development | Changchun vs. Shenzhen Coship Electronics |
| Ming Yang vs. Talkweb Information System | Ming Yang vs. Bank of Communications | Ming Yang vs. Xiangyang Automobile Bearing | Ming Yang vs. Hygon Information Technology |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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