Correlation Between Songz Automobile and Dongguan Aohai
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By analyzing existing cross correlation between Songz Automobile Air and Dongguan Aohai Technology, you can compare the effects of market volatilities on Songz Automobile and Dongguan Aohai 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 Songz Automobile with a short position of Dongguan Aohai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Songz Automobile and Dongguan Aohai.
Diversification Opportunities for Songz Automobile and Dongguan Aohai
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Songz and Dongguan is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Songz Automobile Air and Dongguan Aohai Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongguan Aohai Technology and Songz Automobile 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 Songz Automobile Air are associated (or correlated) with Dongguan Aohai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongguan Aohai Technology has no effect on the direction of Songz Automobile i.e., Songz Automobile and Dongguan Aohai go up and down completely randomly.
Pair Corralation between Songz Automobile and Dongguan Aohai
Assuming the 90 days trading horizon Songz Automobile Air is expected to under-perform the Dongguan Aohai. But the stock apears to be less risky and, when comparing its historical volatility, Songz Automobile Air is 2.31 times less risky than Dongguan Aohai. The stock trades about -0.1 of its potential returns per unit of risk. The Dongguan Aohai Technology is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 3,178 in Dongguan Aohai Technology on September 12, 2024 and sell it today you would earn a total of 899.00 from holding Dongguan Aohai Technology or generate 28.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Songz Automobile Air vs. Dongguan Aohai Technology
Performance |
| Timeline |
| Songz Automobile Air |
| Dongguan Aohai Technology |
Songz Automobile and Dongguan Aohai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Songz Automobile and Dongguan Aohai
The main advantage of trading using opposite Songz Automobile and Dongguan Aohai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Songz Automobile position performs unexpectedly, Dongguan Aohai 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 Dongguan Aohai will offset losses from the drop in Dongguan Aohai's long position.| Songz Automobile vs. Lutian Machinery Co | Songz Automobile vs. PetroChina Co Ltd | Songz Automobile vs. Bank of China | Songz Automobile vs. Gansu Jiu Steel |
| Dongguan Aohai vs. Agricultural Bank of | Dongguan Aohai vs. Industrial and Commercial | Dongguan Aohai vs. Bank of China | Dongguan Aohai vs. PetroChina Co Ltd |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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