Correlation Between BYD Co and China Sports
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By analyzing existing cross correlation between BYD Co Ltd and China Sports Industry, you can compare the effects of market volatilities on BYD Co and China Sports 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 China Sports. Check out your portfolio center. Please also check ongoing floating volatility patterns of BYD Co and China Sports.
Diversification Opportunities for BYD Co and China Sports
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between BYD and China is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding BYD Co Ltd and China Sports Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Sports Industry 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 China Sports. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Sports Industry has no effect on the direction of BYD Co i.e., BYD Co and China Sports go up and down completely randomly.
Pair Corralation between BYD Co and China Sports
Assuming the 90 days trading horizon BYD Co Ltd is expected to under-perform the China Sports. In addition to that, BYD Co is 1.11 times more volatile than China Sports Industry. It trades about -0.25 of its total potential returns per unit of risk. China Sports Industry is currently generating about 0.09 per unit of volatility. If you would invest 815.00 in China Sports Industry on August 31, 2024 and sell it today you would earn a total of 24.00 from holding China Sports Industry or generate 2.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
BYD Co Ltd vs. China Sports Industry
Performance |
| Timeline |
| BYD Co |
| China Sports Industry |
BYD Co and China Sports Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with BYD Co and China Sports
The main advantage of trading using opposite BYD Co and China Sports positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if BYD Co position performs unexpectedly, China Sports 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 China Sports will offset losses from the drop in China Sports' long position.| BYD Co vs. Kingclean Electric Co | BYD Co vs. Keda Clean Energy | BYD Co vs. CSSC Offshore Marine | BYD Co vs. Dhc Software Co |
| China Sports vs. Kweichow Moutai Co | China Sports vs. Contemporary Amperex Technology | China Sports vs. G bits Network Technology | China Sports 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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