Correlation Between Beijing SPC and Caihong Display
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By analyzing existing cross correlation between Beijing SPC Environment and Caihong Display Devices, you can compare the effects of market volatilities on Beijing SPC and Caihong Display 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 Caihong Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing SPC and Caihong Display.
Diversification Opportunities for Beijing SPC and Caihong Display
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Beijing and Caihong is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Beijing SPC Environment and Caihong Display Devices in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caihong Display Devices 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 Caihong Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caihong Display Devices has no effect on the direction of Beijing SPC i.e., Beijing SPC and Caihong Display go up and down completely randomly.
Pair Corralation between Beijing SPC and Caihong Display
Assuming the 90 days trading horizon Beijing SPC Environment is expected to under-perform the Caihong Display. But the stock apears to be less risky and, when comparing its historical volatility, Beijing SPC Environment is 1.5 times less risky than Caihong Display. The stock trades about -0.02 of its potential returns per unit of risk. The Caihong Display Devices is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 460.00 in Caihong Display Devices on August 31, 2024 and sell it today you would earn a total of 237.00 from holding Caihong Display Devices or generate 51.52% 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. Caihong Display Devices
Performance |
| Timeline |
| Beijing SPC Environment |
| Caihong Display Devices |
Beijing SPC and Caihong Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing SPC and Caihong Display
The main advantage of trading using opposite Beijing SPC and Caihong Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing SPC position performs unexpectedly, Caihong Display 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 Caihong Display will offset losses from the drop in Caihong Display's long position.| Beijing SPC vs. Cultural Investment Holdings | Beijing SPC vs. Gome Telecom Equipment | Beijing SPC vs. Bus Online Co | Beijing SPC vs. Holitech Technology Co |
| Caihong Display vs. Guangzhou Boji Medical | Caihong Display vs. Touchstone International Medical | Caihong Display vs. CICC Fund Management | Caihong Display vs. CareRay Digital Medical |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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