Correlation Between Beijing Kaiwen and Kidswant Children
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By analyzing existing cross correlation between Beijing Kaiwen Education and Kidswant Children Products, you can compare the effects of market volatilities on Beijing Kaiwen and Kidswant Children 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 Beijing Kaiwen with a short position of Kidswant Children. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Kaiwen and Kidswant Children.
Diversification Opportunities for Beijing Kaiwen and Kidswant Children
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Beijing and Kidswant is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Kaiwen Education and Kidswant Children Products in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kidswant Children and Beijing Kaiwen 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 Beijing Kaiwen Education are associated (or correlated) with Kidswant Children. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kidswant Children has no effect on the direction of Beijing Kaiwen i.e., Beijing Kaiwen and Kidswant Children go up and down completely randomly.
Pair Corralation between Beijing Kaiwen and Kidswant Children
Assuming the 90 days trading horizon Beijing Kaiwen is expected to generate 1.98 times less return on investment than Kidswant Children. But when comparing it to its historical volatility, Beijing Kaiwen Education is 1.04 times less risky than Kidswant Children. It trades about 0.02 of its potential returns per unit of risk. Kidswant Children Products is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 952.00 in Kidswant Children Products on October 16, 2024 and sell it today you would earn a total of 251.00 from holding Kidswant Children Products or generate 26.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Kaiwen Education vs. Kidswant Children Products
Performance |
| Timeline |
| Beijing Kaiwen Education |
| Kidswant Children |
Beijing Kaiwen and Kidswant Children Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Kaiwen and Kidswant Children
The main advantage of trading using opposite Beijing Kaiwen and Kidswant Children positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Kaiwen position performs unexpectedly, Kidswant Children 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 Kidswant Children will offset losses from the drop in Kidswant Children's long position.| Beijing Kaiwen vs. Hubei Xingfa Chemicals | Beijing Kaiwen vs. Shenzhen Noposion Agrochemicals | Beijing Kaiwen vs. Yingde Greatchem Chemicals | Beijing Kaiwen vs. Dymatic Chemicals |
| Kidswant Children vs. Beijing Kaiwen Education | Kidswant Children vs. Tibet Huayu Mining | Kidswant Children vs. China Publishing Media | Kidswant Children vs. Guangzhou Restaurants 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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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