Correlation Between Shantou Wanshun and Chahua Modern
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By analyzing existing cross correlation between Shantou Wanshun Package and Chahua Modern Housewares, you can compare the effects of market volatilities on Shantou Wanshun and Chahua Modern 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 Shantou Wanshun with a short position of Chahua Modern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shantou Wanshun and Chahua Modern.
Diversification Opportunities for Shantou Wanshun and Chahua Modern
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shantou and Chahua is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Shantou Wanshun Package and Chahua Modern Housewares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chahua Modern Housewares and Shantou Wanshun 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 Shantou Wanshun Package are associated (or correlated) with Chahua Modern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chahua Modern Housewares has no effect on the direction of Shantou Wanshun i.e., Shantou Wanshun and Chahua Modern go up and down completely randomly.
Pair Corralation between Shantou Wanshun and Chahua Modern
Assuming the 90 days trading horizon Shantou Wanshun Package is expected to under-perform the Chahua Modern. But the stock apears to be less risky and, when comparing its historical volatility, Shantou Wanshun Package is 1.1 times less risky than Chahua Modern. The stock trades about -0.03 of its potential returns per unit of risk. The Chahua Modern Housewares is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 837.00 in Chahua Modern Housewares on September 28, 2024 and sell it today you would earn a total of 1,402 from holding Chahua Modern Housewares or generate 167.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shantou Wanshun Package vs. Chahua Modern Housewares
Performance |
| Timeline |
| Shantou Wanshun Package |
| Chahua Modern Housewares |
Shantou Wanshun and Chahua Modern Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shantou Wanshun and Chahua Modern
The main advantage of trading using opposite Shantou Wanshun and Chahua Modern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shantou Wanshun position performs unexpectedly, Chahua Modern 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 Chahua Modern will offset losses from the drop in Chahua Modern's long position.| Shantou Wanshun vs. Changchun UP Optotech | Shantou Wanshun vs. Tianshui Huatian Technology | Shantou Wanshun vs. Sunwoda Electronic | Shantou Wanshun vs. HUAQIN TECHNOLOGY LTD |
| Chahua Modern vs. Xiamen Jihong Package | Chahua Modern vs. New Hope Dairy | Chahua Modern vs. Shantou Wanshun Package | Chahua Modern vs. Jiahe Foods Industry |
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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