Correlation Between Shenzhen Zhongzhuang and Chengdu Spaceon
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By analyzing existing cross correlation between Shenzhen Zhongzhuang Construction and Chengdu Spaceon Electronics, you can compare the effects of market volatilities on Shenzhen Zhongzhuang 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 Shenzhen Zhongzhuang with a short position of Chengdu Spaceon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Zhongzhuang and Chengdu Spaceon.
Diversification Opportunities for Shenzhen Zhongzhuang and Chengdu Spaceon
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Shenzhen and Chengdu is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Zhongzhuang Construct 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 Shenzhen Zhongzhuang 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 Shenzhen Zhongzhuang Construction 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 Shenzhen Zhongzhuang i.e., Shenzhen Zhongzhuang and Chengdu Spaceon go up and down completely randomly.
Pair Corralation between Shenzhen Zhongzhuang and Chengdu Spaceon
Assuming the 90 days trading horizon Shenzhen Zhongzhuang Construction is expected to under-perform the Chengdu Spaceon. In addition to that, Shenzhen Zhongzhuang is 1.47 times more volatile than Chengdu Spaceon Electronics. It trades about -0.47 of its total potential returns per unit of risk. Chengdu Spaceon Electronics is currently generating about -0.4 per unit of volatility. If you would invest 1,812 in Chengdu Spaceon Electronics on October 13, 2024 and sell it today you would lose (305.00) from holding Chengdu Spaceon Electronics or give up 16.83% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Zhongzhuang Construct vs. Chengdu Spaceon Electronics
Performance |
| Timeline |
| Shenzhen Zhongzhuang |
| Chengdu Spaceon Elec |
Shenzhen Zhongzhuang and Chengdu Spaceon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Zhongzhuang and Chengdu Spaceon
The main advantage of trading using opposite Shenzhen Zhongzhuang and Chengdu Spaceon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Zhongzhuang 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.| Shenzhen Zhongzhuang vs. Agricultural Bank of | Shenzhen Zhongzhuang vs. Industrial and Commercial | Shenzhen Zhongzhuang vs. Bank of China | Shenzhen Zhongzhuang vs. PetroChina Co Ltd |
| Chengdu Spaceon vs. Lutian Machinery Co | Chengdu Spaceon vs. Jiahe Foods Industry | Chengdu Spaceon vs. Jinlong Machinery Electronic | Chengdu Spaceon vs. Shenzhen Zhongzhuang Construction |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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