Correlation Between Kuangda Technology and Yuan Longping
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By analyzing existing cross correlation between Kuangda Technology Group and Yuan Longping High tech, you can compare the effects of market volatilities on Kuangda Technology and Yuan Longping 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 Kuangda Technology with a short position of Yuan Longping. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kuangda Technology and Yuan Longping.
Diversification Opportunities for Kuangda Technology and Yuan Longping
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kuangda and Yuan is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Kuangda Technology Group and Yuan Longping High tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yuan Longping High and Kuangda Technology 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 Kuangda Technology Group are associated (or correlated) with Yuan Longping. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yuan Longping High has no effect on the direction of Kuangda Technology i.e., Kuangda Technology and Yuan Longping go up and down completely randomly.
Pair Corralation between Kuangda Technology and Yuan Longping
Assuming the 90 days trading horizon Kuangda Technology Group is expected to generate 1.42 times more return on investment than Yuan Longping. However, Kuangda Technology is 1.42 times more volatile than Yuan Longping High tech. It trades about -0.01 of its potential returns per unit of risk. Yuan Longping High tech is currently generating about -0.2 per unit of risk. If you would invest 494.00 in Kuangda Technology Group on November 3, 2024 and sell it today you would lose (4.00) from holding Kuangda Technology Group or give up 0.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kuangda Technology Group vs. Yuan Longping High tech
Performance |
| Timeline |
| Kuangda Technology |
| Yuan Longping High |
Kuangda Technology and Yuan Longping Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kuangda Technology and Yuan Longping
The main advantage of trading using opposite Kuangda Technology and Yuan Longping positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kuangda Technology position performs unexpectedly, Yuan Longping 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 Yuan Longping will offset losses from the drop in Yuan Longping's long position.| Kuangda Technology vs. StarPower Semiconductor | Kuangda Technology vs. New Hope Dairy | Kuangda Technology vs. Suzhou Oriental Semiconductor | Kuangda Technology vs. Qingdao Foods Co |
| Yuan Longping vs. Bus Online Co | Yuan Longping vs. Holitech Technology Co | Yuan Longping vs. Gome Telecom Equipment | Yuan Longping vs. Cultural Investment Holdings |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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