Correlation Between 159681 and China Southern
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By analyzing existing cross correlation between 159681 and China Southern SSE, you can compare the effects of market volatilities on 159681 and China Southern 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 Southern. Check out your portfolio center. Please also check ongoing floating volatility patterns of 159681 and China Southern.
Diversification Opportunities for 159681 and China Southern
0.57 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between 159681 and China is 0.57. Overlapping area represents the amount of risk that can be diversified away by holding 159681 and China Southern SSE in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Southern SSE 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 Southern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Southern SSE has no effect on the direction of 159681 i.e., 159681 and China Southern go up and down completely randomly.
Pair Corralation between 159681 and China Southern
Assuming the 90 days trading horizon 159681 is expected to generate 2.04 times more return on investment than China Southern. However, 159681 is 2.04 times more volatile than China Southern SSE. It trades about 0.15 of its potential returns per unit of risk. China Southern SSE is currently generating about 0.17 per unit of risk. If you would invest 67.00 in 159681 on September 12, 2024 and sell it today you would earn a total of 32.00 from holding 159681 or generate 47.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
159681 vs. China Southern SSE
Performance |
| Timeline |
| 159681 |
| China Southern SSE |
159681 and China Southern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with 159681 and China Southern
The main advantage of trading using opposite 159681 and China Southern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if 159681 position performs unexpectedly, China Southern 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 Southern will offset losses from the drop in China Southern's long position.The idea behind 159681 and China Southern SSE pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| China Southern vs. China Southern CSI | China Southern vs. China Universal CS | China Southern vs. China Southern CSI | China Southern vs. China Universal CSI |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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