Correlation Between BYD Co and Shenzhen Bingchuan
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By analyzing existing cross correlation between BYD Co Ltd and Shenzhen Bingchuan Network, you can compare the effects of market volatilities on BYD Co and Shenzhen Bingchuan 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 Bingchuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of BYD Co and Shenzhen Bingchuan.
Diversification Opportunities for BYD Co and Shenzhen Bingchuan
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between BYD and Shenzhen is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding BYD Co Ltd and Shenzhen Bingchuan Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Bingchuan 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 Bingchuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Bingchuan has no effect on the direction of BYD Co i.e., BYD Co and Shenzhen Bingchuan go up and down completely randomly.
Pair Corralation between BYD Co and Shenzhen Bingchuan
Assuming the 90 days trading horizon BYD Co is expected to generate 7.32 times less return on investment than Shenzhen Bingchuan. But when comparing it to its historical volatility, BYD Co Ltd is 2.06 times less risky than Shenzhen Bingchuan. It trades about 0.05 of its potential returns per unit of risk. Shenzhen Bingchuan Network is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,942 in Shenzhen Bingchuan Network on November 3, 2024 and sell it today you would earn a total of 198.00 from holding Shenzhen Bingchuan Network or generate 10.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
BYD Co Ltd vs. Shenzhen Bingchuan Network
Performance |
| Timeline |
| BYD Co |
| Shenzhen Bingchuan |
BYD Co and Shenzhen Bingchuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BYD Co and Shenzhen Bingchuan
The main advantage of trading using opposite BYD Co and Shenzhen Bingchuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BYD Co position performs unexpectedly, Shenzhen Bingchuan 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 Bingchuan will offset losses from the drop in Shenzhen Bingchuan's long position.| BYD Co vs. Ningbo Ligong Online | BYD Co vs. Hefei Metalforming Mach | BYD Co vs. Hainan Mining Co | BYD Co vs. Pengxin International Mining |
| Shenzhen Bingchuan vs. Lier Chemical Co | Shenzhen Bingchuan vs. Lianhe Chemical Technology | Shenzhen Bingchuan vs. Huasi Agricultural Development | Shenzhen Bingchuan vs. Tjk Machinery Tianjin |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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