Correlation Between Kuang Chi and Shandong Rike
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By analyzing existing cross correlation between Kuang Chi Technologies and Shandong Rike Chemical, you can compare the effects of market volatilities on Kuang Chi and Shandong Rike 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 Shandong Rike. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kuang Chi and Shandong Rike.
Diversification Opportunities for Kuang Chi and Shandong Rike
-0.16 | Correlation Coefficient |
Good diversification
The 3 months correlation between Kuang and Shandong is -0.16. Overlapping area represents the amount of risk that can be diversified away by holding Kuang Chi Technologies and Shandong Rike Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Rike 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 Shandong Rike. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Rike Chemical has no effect on the direction of Kuang Chi i.e., Kuang Chi and Shandong Rike go up and down completely randomly.
Pair Corralation between Kuang Chi and Shandong Rike
Assuming the 90 days trading horizon Kuang Chi Technologies is expected to under-perform the Shandong Rike. But the stock apears to be less risky and, when comparing its historical volatility, Kuang Chi Technologies is 1.08 times less risky than Shandong Rike. The stock trades about -0.21 of its potential returns per unit of risk. The Shandong Rike Chemical is currently generating about -0.04 of returns per unit of risk over similar time horizon. If you would invest 590.00 in Shandong Rike Chemical on October 30, 2024 and sell it today you would lose (27.00) from holding Shandong Rike Chemical or give up 4.58% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kuang Chi Technologies vs. Shandong Rike Chemical
Performance |
| Timeline |
| Kuang Chi Technologies |
| Shandong Rike Chemical |
Kuang Chi and Shandong Rike Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kuang Chi and Shandong Rike
The main advantage of trading using opposite Kuang Chi and Shandong Rike positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kuang Chi position performs unexpectedly, Shandong Rike 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 Shandong Rike will offset losses from the drop in Shandong Rike's long position.| Kuang Chi vs. Allied Machinery Co | Kuang Chi vs. Huasi Agricultural Development | Kuang Chi vs. COL Digital Publishing | Kuang Chi vs. Lutian Machinery Co |
| Shandong Rike vs. Zijin Mining Group | Shandong Rike vs. Wanhua Chemical Group | Shandong Rike vs. Baoshan Iron Steel | Shandong Rike vs. Shandong Gold Mining |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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