Correlation Between Songz Automobile and Ligao Foods
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By analyzing existing cross correlation between Songz Automobile Air and Ligao Foods CoLtd, you can compare the effects of market volatilities on Songz Automobile and Ligao Foods 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 Ligao Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Songz Automobile and Ligao Foods.
Diversification Opportunities for Songz Automobile and Ligao Foods
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Songz and Ligao is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Songz Automobile Air and Ligao Foods CoLtd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ligao Foods CoLtd 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 Ligao Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ligao Foods CoLtd has no effect on the direction of Songz Automobile i.e., Songz Automobile and Ligao Foods go up and down completely randomly.
Pair Corralation between Songz Automobile and Ligao Foods
Assuming the 90 days trading horizon Songz Automobile Air is expected to generate 0.91 times more return on investment than Ligao Foods. However, Songz Automobile Air is 1.1 times less risky than Ligao Foods. It trades about 0.1 of its potential returns per unit of risk. Ligao Foods CoLtd is currently generating about -0.03 per unit of risk. If you would invest 655.00 in Songz Automobile Air on August 31, 2024 and sell it today you would earn a total of 32.00 from holding Songz Automobile Air or generate 4.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Songz Automobile Air vs. Ligao Foods CoLtd
Performance |
| Timeline |
| Songz Automobile Air |
| Ligao Foods CoLtd |
Songz Automobile and Ligao Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Songz Automobile and Ligao Foods
The main advantage of trading using opposite Songz Automobile and Ligao Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Songz Automobile position performs unexpectedly, Ligao Foods 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 Ligao Foods will offset losses from the drop in Ligao Foods' long position.| Songz Automobile vs. China State Construction | Songz Automobile vs. China Merchants Shekou | Songz Automobile vs. Huafa Industrial Co | Songz Automobile vs. China International Capital |
| Ligao Foods vs. Lutian Machinery Co | Ligao Foods vs. PetroChina Co Ltd | Ligao Foods vs. Bank of China | Ligao Foods vs. Gansu Jiu Steel |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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