Correlation Between Sichuan Fulin and SUNSEA Telecommunicatio
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By analyzing existing cross correlation between Sichuan Fulin Transportation and SUNSEA Telecommunications Co, you can compare the effects of market volatilities on Sichuan Fulin and SUNSEA Telecommunicatio 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 Sichuan Fulin with a short position of SUNSEA Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sichuan Fulin and SUNSEA Telecommunicatio.
Diversification Opportunities for Sichuan Fulin and SUNSEA Telecommunicatio
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sichuan and SUNSEA is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Sichuan Fulin Transportation and SUNSEA Telecommunications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUNSEA Telecommunicatio and Sichuan Fulin 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 Sichuan Fulin Transportation are associated (or correlated) with SUNSEA Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SUNSEA Telecommunicatio has no effect on the direction of Sichuan Fulin i.e., Sichuan Fulin and SUNSEA Telecommunicatio go up and down completely randomly.
Pair Corralation between Sichuan Fulin and SUNSEA Telecommunicatio
Assuming the 90 days trading horizon Sichuan Fulin Transportation is expected to under-perform the SUNSEA Telecommunicatio. But the stock apears to be less risky and, when comparing its historical volatility, Sichuan Fulin Transportation is 2.06 times less risky than SUNSEA Telecommunicatio. The stock trades about -0.03 of its potential returns per unit of risk. The SUNSEA Telecommunications Co is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 923.00 in SUNSEA Telecommunications Co on October 11, 2024 and sell it today you would earn a total of 24.00 from holding SUNSEA Telecommunications Co or generate 2.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sichuan Fulin Transportation vs. SUNSEA Telecommunications Co
Performance |
| Timeline |
| Sichuan Fulin Transp |
| SUNSEA Telecommunicatio |
Sichuan Fulin and SUNSEA Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sichuan Fulin and SUNSEA Telecommunicatio
The main advantage of trading using opposite Sichuan Fulin and SUNSEA Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sichuan Fulin position performs unexpectedly, SUNSEA Telecommunicatio 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 SUNSEA Telecommunicatio will offset losses from the drop in SUNSEA Telecommunicatio's long position.| Sichuan Fulin vs. Dareway Software Co | Sichuan Fulin vs. Muyuan Foodstuff Co | Sichuan Fulin vs. Ligao Foods CoLtd | Sichuan Fulin vs. Great Sun Foods Co |
| SUNSEA Telecommunicatio vs. Bingo Software Co | SUNSEA Telecommunicatio vs. Hangzhou Pinming Software | SUNSEA Telecommunicatio vs. Digiwin Software Co | SUNSEA Telecommunicatio vs. Kuangda Technology Group |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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