Correlation Between Beijing SPC and DO Home
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By analyzing existing cross correlation between Beijing SPC Environment and DO Home Collection, you can compare the effects of market volatilities on Beijing SPC and DO Home 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 Beijing SPC with a short position of DO Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing SPC and DO Home.
Diversification Opportunities for Beijing SPC and DO Home
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Beijing and 002798 is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Beijing SPC Environment and DO Home Collection in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DO Home Collection and Beijing SPC 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 Beijing SPC Environment are associated (or correlated) with DO Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DO Home Collection has no effect on the direction of Beijing SPC i.e., Beijing SPC and DO Home go up and down completely randomly.
Pair Corralation between Beijing SPC and DO Home
Assuming the 90 days trading horizon Beijing SPC Environment is expected to under-perform the DO Home. But the stock apears to be less risky and, when comparing its historical volatility, Beijing SPC Environment is 1.47 times less risky than DO Home. The stock trades about -0.01 of its potential returns per unit of risk. The DO Home Collection is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 411.00 in DO Home Collection on September 3, 2024 and sell it today you would earn a total of 33.00 from holding DO Home Collection or generate 8.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing SPC Environment vs. DO Home Collection
Performance |
| Timeline |
| Beijing SPC Environment |
| DO Home Collection |
Beijing SPC and DO Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing SPC and DO Home
The main advantage of trading using opposite Beijing SPC and DO Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing SPC position performs unexpectedly, DO Home 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 DO Home will offset losses from the drop in DO Home's long position.| Beijing SPC vs. Zhejiang Yayi Metal | Beijing SPC vs. Zijin Mining Group | Beijing SPC vs. Uroica Mining Safety | Beijing SPC vs. Ningbo Thermal Power |
| DO Home vs. Anhui Jianghuai Automobile | DO Home vs. Sinomach Automobile Co | DO Home vs. Zotye Automobile Co | DO Home vs. Shuhua Sports Co |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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