Correlation Between BYD Co and Shenzhen Silver
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By analyzing existing cross correlation between BYD Co Ltd and Shenzhen Silver Basis, you can compare the effects of market volatilities on BYD Co and Shenzhen Silver 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 BYD Co with a short position of Shenzhen Silver. Check out your portfolio center. Please also check ongoing floating volatility patterns of BYD Co and Shenzhen Silver.
Diversification Opportunities for BYD Co and Shenzhen Silver
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between BYD and Shenzhen is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding BYD Co Ltd and Shenzhen Silver Basis in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Silver Basis and BYD Co 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 BYD Co Ltd are associated (or correlated) with Shenzhen Silver. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Silver Basis has no effect on the direction of BYD Co i.e., BYD Co and Shenzhen Silver go up and down completely randomly.
Pair Corralation between BYD Co and Shenzhen Silver
Assuming the 90 days trading horizon BYD Co Ltd is expected to generate 0.54 times more return on investment than Shenzhen Silver. However, BYD Co Ltd is 1.84 times less risky than Shenzhen Silver. It trades about -0.05 of its potential returns per unit of risk. Shenzhen Silver Basis is currently generating about -0.16 per unit of risk. If you would invest 28,842 in BYD Co Ltd on October 25, 2024 and sell it today you would lose (592.00) from holding BYD Co Ltd or give up 2.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BYD Co Ltd vs. Shenzhen Silver Basis
Performance |
| Timeline |
| BYD Co |
| Shenzhen Silver Basis |
BYD Co and Shenzhen Silver Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BYD Co and Shenzhen Silver
The main advantage of trading using opposite BYD Co and Shenzhen Silver positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BYD Co position performs unexpectedly, Shenzhen Silver 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 Shenzhen Silver will offset losses from the drop in Shenzhen Silver's long position.| BYD Co vs. HeBei Jinniu Chemical | BYD Co vs. Maoming Petro Chemical Shihua | BYD Co vs. TongFu Microelectronics Co | BYD Co vs. Hengli Petrochemical Co |
| Shenzhen Silver vs. Kweichow Moutai Co | Shenzhen Silver vs. Contemporary Amperex Technology | Shenzhen Silver vs. Beijing Roborock Technology | Shenzhen Silver vs. BYD 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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