Correlation Between Kuang Chi and Shenyang Chemical
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By analyzing existing cross correlation between Kuang Chi Technologies and Shenyang Chemical Industry, you can compare the effects of market volatilities on Kuang Chi and Shenyang Chemical 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 Kuang Chi with a short position of Shenyang Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kuang Chi and Shenyang Chemical.
Diversification Opportunities for Kuang Chi and Shenyang Chemical
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Kuang and Shenyang is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Kuang Chi Technologies and Shenyang Chemical Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenyang Chemical and Kuang Chi 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 Kuang Chi Technologies are associated (or correlated) with Shenyang Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenyang Chemical has no effect on the direction of Kuang Chi i.e., Kuang Chi and Shenyang Chemical go up and down completely randomly.
Pair Corralation between Kuang Chi and Shenyang Chemical
Assuming the 90 days trading horizon Kuang Chi Technologies is expected to generate 1.16 times more return on investment than Shenyang Chemical. However, Kuang Chi is 1.16 times more volatile than Shenyang Chemical Industry. It trades about 0.07 of its potential returns per unit of risk. Shenyang Chemical Industry is currently generating about -0.02 per unit of risk. If you would invest 1,811 in Kuang Chi Technologies on October 16, 2024 and sell it today you would earn a total of 2,234 from holding Kuang Chi Technologies or generate 123.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kuang Chi Technologies vs. Shenyang Chemical Industry
Performance |
| Timeline |
| Kuang Chi Technologies |
| Shenyang Chemical |
Kuang Chi and Shenyang Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kuang Chi and Shenyang Chemical
The main advantage of trading using opposite Kuang Chi and Shenyang Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kuang Chi position performs unexpectedly, Shenyang Chemical 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 Shenyang Chemical will offset losses from the drop in Shenyang Chemical's long position.| Kuang Chi vs. China World Trade | Kuang Chi vs. XiaMen HongXin Electron tech | Kuang Chi vs. Sharetronic Data Technology | Kuang Chi vs. China Eastern Airlines |
| Shenyang Chemical vs. Luyin Investment Group | Shenyang Chemical vs. Chengdu Xingrong Investment | Shenyang Chemical vs. Nuode Investment Co | Shenyang Chemical vs. Western Metal Materials |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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