Correlation Between Strait Innovation and China Merchants
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By analyzing existing cross correlation between Strait Innovation Internet and China Merchants Shekou, you can compare the effects of market volatilities on Strait Innovation and China Merchants 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 Strait Innovation with a short position of China Merchants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Strait Innovation and China Merchants.
Diversification Opportunities for Strait Innovation and China Merchants
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Strait and China is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Strait Innovation Internet and China Merchants Shekou in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Merchants Shekou and Strait Innovation 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 Strait Innovation Internet are associated (or correlated) with China Merchants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Merchants Shekou has no effect on the direction of Strait Innovation i.e., Strait Innovation and China Merchants go up and down completely randomly.
Pair Corralation between Strait Innovation and China Merchants
Assuming the 90 days trading horizon Strait Innovation Internet is expected to under-perform the China Merchants. In addition to that, Strait Innovation is 2.75 times more volatile than China Merchants Shekou. It trades about -0.21 of its total potential returns per unit of risk. China Merchants Shekou is currently generating about -0.16 per unit of volatility. If you would invest 1,063 in China Merchants Shekou on October 18, 2024 and sell it today you would lose (54.00) from holding China Merchants Shekou or give up 5.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Strait Innovation Internet vs. China Merchants Shekou
Performance |
| Timeline |
| Strait Innovation |
| China Merchants Shekou |
Strait Innovation and China Merchants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Strait Innovation and China Merchants
The main advantage of trading using opposite Strait Innovation and China Merchants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Strait Innovation position performs unexpectedly, China Merchants 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 Merchants will offset losses from the drop in China Merchants' long position.| Strait Innovation vs. Beijing Sanyuan Foods | Strait Innovation vs. Guangdong Shenglu Telecommunication | Strait Innovation vs. Fujian Anjoy Foods | Strait Innovation vs. Wintao Communications Co |
| China Merchants vs. Jiangnan Mould Plastic | China Merchants vs. Unisplendour Corp | China Merchants vs. Strait Innovation Internet | China Merchants vs. Sichuan Jinshi 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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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