Correlation Between 159681 and China Longyuan
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By analyzing existing cross correlation between 159681 and China Longyuan Power, you can compare the effects of market volatilities on 159681 and China Longyuan 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 159681 with a short position of China Longyuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of 159681 and China Longyuan.
Diversification Opportunities for 159681 and China Longyuan
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between 159681 and China is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding 159681 and China Longyuan Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Longyuan Power and 159681 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 159681 are associated (or correlated) with China Longyuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Longyuan Power has no effect on the direction of 159681 i.e., 159681 and China Longyuan go up and down completely randomly.
Pair Corralation between 159681 and China Longyuan
Assuming the 90 days trading horizon 159681 is expected to generate 1.45 times more return on investment than China Longyuan. However, 159681 is 1.45 times more volatile than China Longyuan Power. It trades about 0.05 of its potential returns per unit of risk. China Longyuan Power is currently generating about -0.01 per unit of risk. If you would invest 75.00 in 159681 on September 20, 2024 and sell it today you would earn a total of 22.00 from holding 159681 or generate 29.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
159681 vs. China Longyuan Power
Performance |
| Timeline |
| 159681 |
| China Longyuan Power |
159681 and China Longyuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 159681 and China Longyuan
The main advantage of trading using opposite 159681 and China Longyuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 159681 position performs unexpectedly, China Longyuan 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 China Longyuan will offset losses from the drop in China Longyuan's long position.| 159681 vs. Shenzhen MTC Co | 159681 vs. Ming Yang Smart | 159681 vs. Changzhou Almaden Co | 159681 vs. 159005 |
| China Longyuan vs. Ming Yang Smart | China Longyuan vs. 159681 | China Longyuan vs. 159005 | China Longyuan vs. Loctek Ergonomic Technology |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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