Correlation Between Chengdu Spaceon and Wuhan Yangtze
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By analyzing existing cross correlation between Chengdu Spaceon Electronics and Wuhan Yangtze Communication, you can compare the effects of market volatilities on Chengdu Spaceon and Wuhan Yangtze 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 Wuhan Yangtze. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu Spaceon and Wuhan Yangtze.
Diversification Opportunities for Chengdu Spaceon and Wuhan Yangtze
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Chengdu and Wuhan is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu Spaceon Electronics and Wuhan Yangtze Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wuhan Yangtze Commun 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 Wuhan Yangtze. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wuhan Yangtze Commun has no effect on the direction of Chengdu Spaceon i.e., Chengdu Spaceon and Wuhan Yangtze go up and down completely randomly.
Pair Corralation between Chengdu Spaceon and Wuhan Yangtze
Assuming the 90 days trading horizon Chengdu Spaceon is expected to generate 5.72 times less return on investment than Wuhan Yangtze. But when comparing it to its historical volatility, Chengdu Spaceon Electronics is 1.27 times less risky than Wuhan Yangtze. It trades about 0.01 of its potential returns per unit of risk. Wuhan Yangtze Communication is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 1,685 in Wuhan Yangtze Communication on September 3, 2024 and sell it today you would earn a total of 1,284 from holding Wuhan Yangtze Communication or generate 76.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu Spaceon Electronics vs. Wuhan Yangtze Communication
Performance |
| Timeline |
| Chengdu Spaceon Elec |
| Wuhan Yangtze Commun |
Chengdu Spaceon and Wuhan Yangtze Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu Spaceon and Wuhan Yangtze
The main advantage of trading using opposite Chengdu Spaceon and Wuhan Yangtze positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu Spaceon position performs unexpectedly, Wuhan Yangtze 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 Wuhan Yangtze will offset losses from the drop in Wuhan Yangtze's long position.| Chengdu Spaceon vs. Agricultural Bank of | Chengdu Spaceon vs. China Construction Bank | Chengdu Spaceon vs. Postal Savings Bank | Chengdu Spaceon vs. Bank of Communications |
| Wuhan Yangtze vs. Agricultural Bank of | Wuhan Yangtze vs. China Construction Bank | Wuhan Yangtze vs. Postal Savings Bank | Wuhan Yangtze vs. Bank of Communications |
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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