Correlation Between Hangzhou Weiguang and Southchip Semiconductor
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By analyzing existing cross correlation between Hangzhou Weiguang Electronic and Southchip Semiconductor Technology, you can compare the effects of market volatilities on Hangzhou Weiguang and Southchip Semiconductor 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 Hangzhou Weiguang with a short position of Southchip Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hangzhou Weiguang and Southchip Semiconductor.
Diversification Opportunities for Hangzhou Weiguang and Southchip Semiconductor
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hangzhou and Southchip is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Hangzhou Weiguang Electronic and Southchip Semiconductor Techno in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Southchip Semiconductor and Hangzhou Weiguang 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 Hangzhou Weiguang Electronic are associated (or correlated) with Southchip Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Southchip Semiconductor has no effect on the direction of Hangzhou Weiguang i.e., Hangzhou Weiguang and Southchip Semiconductor go up and down completely randomly.
Pair Corralation between Hangzhou Weiguang and Southchip Semiconductor
Assuming the 90 days trading horizon Hangzhou Weiguang Electronic is expected to generate 0.97 times more return on investment than Southchip Semiconductor. However, Hangzhou Weiguang Electronic is 1.03 times less risky than Southchip Semiconductor. It trades about 0.26 of its potential returns per unit of risk. Southchip Semiconductor Technology is currently generating about 0.21 per unit of risk. If you would invest 2,299 in Hangzhou Weiguang Electronic on September 13, 2024 and sell it today you would earn a total of 334.00 from holding Hangzhou Weiguang Electronic or generate 14.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hangzhou Weiguang Electronic vs. Southchip Semiconductor Techno
Performance |
| Timeline |
| Hangzhou Weiguang |
| Southchip Semiconductor |
Hangzhou Weiguang and Southchip Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hangzhou Weiguang and Southchip Semiconductor
The main advantage of trading using opposite Hangzhou Weiguang and Southchip Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hangzhou Weiguang position performs unexpectedly, Southchip Semiconductor 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 Southchip Semiconductor will offset losses from the drop in Southchip Semiconductor's long position.| Hangzhou Weiguang vs. PetroChina Co Ltd | Hangzhou Weiguang vs. China Mobile Limited | Hangzhou Weiguang vs. CNOOC Limited | Hangzhou Weiguang vs. Ping An Insurance |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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