Correlation Between Shenzhen Changfang and China World
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By analyzing existing cross correlation between Shenzhen Changfang Light and China World Trade, you can compare the effects of market volatilities on Shenzhen Changfang and China World 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 Shenzhen Changfang with a short position of China World. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Changfang and China World.
Diversification Opportunities for Shenzhen Changfang and China World
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Shenzhen and China is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Changfang Light and China World Trade in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China World Trade and Shenzhen Changfang 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 Shenzhen Changfang Light are associated (or correlated) with China World. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China World Trade has no effect on the direction of Shenzhen Changfang i.e., Shenzhen Changfang and China World go up and down completely randomly.
Pair Corralation between Shenzhen Changfang and China World
Assuming the 90 days trading horizon Shenzhen Changfang Light is expected to generate 2.43 times more return on investment than China World. However, Shenzhen Changfang is 2.43 times more volatile than China World Trade. It trades about 0.25 of its potential returns per unit of risk. China World Trade is currently generating about 0.08 per unit of risk. If you would invest 168.00 in Shenzhen Changfang Light on October 22, 2024 and sell it today you would earn a total of 25.00 from holding Shenzhen Changfang Light or generate 14.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Shenzhen Changfang Light vs. China World Trade
Performance |
| Timeline |
| Shenzhen Changfang Light |
| China World Trade |
Shenzhen Changfang and China World Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Changfang and China World
The main advantage of trading using opposite Shenzhen Changfang and China World positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Changfang position performs unexpectedly, China World 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 World will offset losses from the drop in China World's long position.| Shenzhen Changfang vs. Sichuan Fulin Transportation | Shenzhen Changfang vs. Success Electronics | Shenzhen Changfang vs. Sportsoul Co Ltd | Shenzhen Changfang vs. Hainan Airlines Co |
| China World vs. Shandong Sanyuan Biotechnology | China World vs. Anhui Transport Consulting | China World vs. Fujian Wanchen Biotechnology | China World vs. Heilongjiang Transport Development |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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