Correlation Between Shandong Longquan and Chengdu Spaceon
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By analyzing existing cross correlation between Shandong Longquan Pipeline and Chengdu Spaceon Electronics, you can compare the effects of market volatilities on Shandong Longquan and Chengdu Spaceon 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 Shandong Longquan with a short position of Chengdu Spaceon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Longquan and Chengdu Spaceon.
Diversification Opportunities for Shandong Longquan and Chengdu Spaceon
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shandong and Chengdu is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Longquan Pipeline and Chengdu Spaceon Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chengdu Spaceon Elec and Shandong Longquan 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 Shandong Longquan Pipeline are associated (or correlated) with Chengdu Spaceon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chengdu Spaceon Elec has no effect on the direction of Shandong Longquan i.e., Shandong Longquan and Chengdu Spaceon go up and down completely randomly.
Pair Corralation between Shandong Longquan and Chengdu Spaceon
Assuming the 90 days trading horizon Shandong Longquan Pipeline is expected to generate 0.92 times more return on investment than Chengdu Spaceon. However, Shandong Longquan Pipeline is 1.08 times less risky than Chengdu Spaceon. It trades about 0.05 of its potential returns per unit of risk. Chengdu Spaceon Electronics is currently generating about -0.18 per unit of risk. If you would invest 460.00 in Shandong Longquan Pipeline on August 29, 2024 and sell it today you would earn a total of 9.00 from holding Shandong Longquan Pipeline or generate 1.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Shandong Longquan Pipeline vs. Chengdu Spaceon Electronics
Performance |
| Timeline |
| Shandong Longquan |
| Chengdu Spaceon Elec |
Shandong Longquan and Chengdu Spaceon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Longquan and Chengdu Spaceon
The main advantage of trading using opposite Shandong Longquan and Chengdu Spaceon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Longquan position performs unexpectedly, Chengdu Spaceon 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 Chengdu Spaceon will offset losses from the drop in Chengdu Spaceon's long position.| Shandong Longquan vs. Baoshan Iron Steel | Shandong Longquan vs. Shandong Gold Mining | Shandong Longquan vs. Rongsheng Petrochemical Co | Shandong Longquan vs. Inner Mongolia BaoTou |
| Chengdu Spaceon vs. China State Construction | Chengdu Spaceon vs. Huafa Industrial Co | Chengdu Spaceon vs. China International Capital | Chengdu Spaceon vs. Kweichow Moutai Co |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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