Correlation Between Masterwork Machinery and New China
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By analyzing existing cross correlation between Masterwork Machinery and New China Life, you can compare the effects of market volatilities on Masterwork Machinery and New China 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 New China. Check out your portfolio center. Please also check ongoing floating volatility patterns of Masterwork Machinery and New China.
Diversification Opportunities for Masterwork Machinery and New China
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Masterwork and New is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Masterwork Machinery and New China Life in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on New China Life 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 New China. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of New China Life has no effect on the direction of Masterwork Machinery i.e., Masterwork Machinery and New China go up and down completely randomly.
Pair Corralation between Masterwork Machinery and New China
Assuming the 90 days trading horizon Masterwork Machinery is expected to generate 0.92 times more return on investment than New China. However, Masterwork Machinery is 1.09 times less risky than New China. It trades about 0.17 of its potential returns per unit of risk. New China Life is currently generating about 0.07 per unit of risk. If you would invest 576.00 in Masterwork Machinery on December 1, 2024 and sell it today you would earn a total of 38.00 from holding Masterwork Machinery or generate 6.6% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Masterwork Machinery vs. New China Life
Performance |
| Timeline |
| Masterwork Machinery |
| New China Life |
Masterwork Machinery and New China Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Masterwork Machinery and New China
The main advantage of trading using opposite Masterwork Machinery and New China positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Masterwork Machinery position performs unexpectedly, New China 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 New China will offset losses from the drop in New China's long position.| Masterwork Machinery vs. TianJin 712 Communication | Masterwork Machinery vs. Caihong Display Devices | Masterwork Machinery vs. Shanghai Shibei Hi Tech | Masterwork Machinery vs. Fujian Newland Computer |
| New China vs. Hengerda New Materials | New China vs. Orinko Advanced Plastics | New China vs. Guobo Electronics Co | New China vs. Sanxiang Advanced Materials |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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