Correlation Between Chengdu Spaceon and Shanghai Construction
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By analyzing existing cross correlation between Chengdu Spaceon Electronics and Shanghai Construction Group, you can compare the effects of market volatilities on Chengdu Spaceon and Shanghai Construction 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 Chengdu Spaceon with a short position of Shanghai Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu Spaceon and Shanghai Construction.
Diversification Opportunities for Chengdu Spaceon and Shanghai Construction
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Chengdu and Shanghai is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu Spaceon Electronics and Shanghai Construction Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Construction and Chengdu Spaceon 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 Chengdu Spaceon Electronics are associated (or correlated) with Shanghai Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Construction has no effect on the direction of Chengdu Spaceon i.e., Chengdu Spaceon and Shanghai Construction go up and down completely randomly.
Pair Corralation between Chengdu Spaceon and Shanghai Construction
Assuming the 90 days trading horizon Chengdu Spaceon Electronics is expected to generate 1.4 times more return on investment than Shanghai Construction. However, Chengdu Spaceon is 1.4 times more volatile than Shanghai Construction Group. It trades about 0.05 of its potential returns per unit of risk. Shanghai Construction Group is currently generating about 0.06 per unit of risk. If you would invest 1,361 in Chengdu Spaceon Electronics on August 31, 2024 and sell it today you would earn a total of 216.00 from holding Chengdu Spaceon Electronics or generate 15.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu Spaceon Electronics vs. Shanghai Construction Group
Performance |
| Timeline |
| Chengdu Spaceon Elec |
| Shanghai Construction |
Chengdu Spaceon and Shanghai Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu Spaceon and Shanghai Construction
The main advantage of trading using opposite Chengdu Spaceon and Shanghai Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu Spaceon position performs unexpectedly, Shanghai Construction 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 Shanghai Construction will offset losses from the drop in Shanghai Construction's long position.| Chengdu Spaceon vs. MayAir Technology Co | Chengdu Spaceon vs. Guangzhou Dongfang Hotel | Chengdu Spaceon vs. Sanbo Hospital Management | Chengdu Spaceon vs. De Rucci Healthy |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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