Correlation Between Kuang Chi and ISoftStone Information
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By analyzing existing cross correlation between Kuang Chi Technologies and iSoftStone Information Technology, you can compare the effects of market volatilities on Kuang Chi and ISoftStone Information 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 ISoftStone Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kuang Chi and ISoftStone Information.
Diversification Opportunities for Kuang Chi and ISoftStone Information
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Kuang and ISoftStone is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Kuang Chi Technologies and iSoftStone Information Technol in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on iSoftStone Information 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 ISoftStone Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of iSoftStone Information has no effect on the direction of Kuang Chi i.e., Kuang Chi and ISoftStone Information go up and down completely randomly.
Pair Corralation between Kuang Chi and ISoftStone Information
Assuming the 90 days trading horizon Kuang Chi Technologies is expected to under-perform the ISoftStone Information. In addition to that, Kuang Chi is 1.0 times more volatile than iSoftStone Information Technology. It trades about -0.21 of its total potential returns per unit of risk. iSoftStone Information Technology is currently generating about -0.06 per unit of volatility. If you would invest 7,000 in iSoftStone Information Technology on September 12, 2024 and sell it today you would lose (382.00) from holding iSoftStone Information Technology or give up 5.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kuang Chi Technologies vs. iSoftStone Information Technol
Performance |
| Timeline |
| Kuang Chi Technologies |
| iSoftStone Information |
Kuang Chi and ISoftStone Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kuang Chi and ISoftStone Information
The main advantage of trading using opposite Kuang Chi and ISoftStone Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kuang Chi position performs unexpectedly, ISoftStone Information 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 ISoftStone Information will offset losses from the drop in ISoftStone Information's long position.| Kuang Chi vs. Lutian Machinery Co | Kuang Chi vs. PetroChina Co Ltd | Kuang Chi vs. Bank of China | Kuang Chi vs. Gansu Jiu Steel |
| ISoftStone Information vs. Gansu Jiu Steel | ISoftStone Information vs. Shandong Mining Machinery | ISoftStone Information vs. Aba Chemicals Corp | ISoftStone Information vs. BlueFocus Communication Group |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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