Correlation Between Masterwork Machinery and Changchun Faway
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By analyzing existing cross correlation between Masterwork Machinery and Changchun Faway Automobile, you can compare the effects of market volatilities on Masterwork Machinery and Changchun Faway 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 Masterwork Machinery with a short position of Changchun Faway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Masterwork Machinery and Changchun Faway.
Diversification Opportunities for Masterwork Machinery and Changchun Faway
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Masterwork and Changchun is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Masterwork Machinery and Changchun Faway Automobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changchun Faway Auto and Masterwork Machinery 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 Masterwork Machinery are associated (or correlated) with Changchun Faway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changchun Faway Auto has no effect on the direction of Masterwork Machinery i.e., Masterwork Machinery and Changchun Faway go up and down completely randomly.
Pair Corralation between Masterwork Machinery and Changchun Faway
Assuming the 90 days trading horizon Masterwork Machinery is expected to generate 2.36 times more return on investment than Changchun Faway. However, Masterwork Machinery is 2.36 times more volatile than Changchun Faway Automobile. It trades about 0.09 of its potential returns per unit of risk. Changchun Faway Automobile is currently generating about -0.01 per unit of risk. If you would invest 563.00 in Masterwork Machinery on August 29, 2024 and sell it today you would earn a total of 46.00 from holding Masterwork Machinery or generate 8.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Masterwork Machinery vs. Changchun Faway Automobile
Performance |
| Timeline |
| Masterwork Machinery |
| Changchun Faway Auto |
Masterwork Machinery and Changchun Faway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Masterwork Machinery and Changchun Faway
The main advantage of trading using opposite Masterwork Machinery and Changchun Faway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Masterwork Machinery position performs unexpectedly, Changchun Faway 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 Changchun Faway will offset losses from the drop in Changchun Faway's long position.| Masterwork Machinery vs. Biwin Storage Technology | Masterwork Machinery vs. PetroChina Co Ltd | Masterwork Machinery vs. Industrial and Commercial | Masterwork Machinery vs. China Construction Bank |
| Changchun Faway vs. Miracll Chemicals Co | Changchun Faway vs. Guangzhou KingTeller Technology | Changchun Faway vs. Nantong Jiangshan Agrochemical | Changchun Faway vs. Shanghai Jinfeng Wine |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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