Correlation Between Chaozhou Three-circle and Sinofibers Technology
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By analyzing existing cross correlation between Chaozhou Three circle Group and Sinofibers Technology Co, you can compare the effects of market volatilities on Chaozhou Three-circle and Sinofibers Technology 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 Chaozhou Three-circle with a short position of Sinofibers Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chaozhou Three-circle and Sinofibers Technology.
Diversification Opportunities for Chaozhou Three-circle and Sinofibers Technology
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Chaozhou and Sinofibers is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Chaozhou Three circle Group and Sinofibers Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinofibers Technology and Chaozhou Three-circle 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 Chaozhou Three circle Group are associated (or correlated) with Sinofibers Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinofibers Technology has no effect on the direction of Chaozhou Three-circle i.e., Chaozhou Three-circle and Sinofibers Technology go up and down completely randomly.
Pair Corralation between Chaozhou Three-circle and Sinofibers Technology
Assuming the 90 days trading horizon Chaozhou Three circle Group is expected to generate 0.62 times more return on investment than Sinofibers Technology. However, Chaozhou Three circle Group is 1.61 times less risky than Sinofibers Technology. It trades about -0.04 of its potential returns per unit of risk. Sinofibers Technology Co is currently generating about -0.16 per unit of risk. If you would invest 3,717 in Chaozhou Three circle Group on September 1, 2024 and sell it today you would lose (83.00) from holding Chaozhou Three circle Group or give up 2.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Chaozhou Three circle Group vs. Sinofibers Technology Co
Performance |
| Timeline |
| Chaozhou Three circle |
| Sinofibers Technology |
Chaozhou Three-circle and Sinofibers Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chaozhou Three-circle and Sinofibers Technology
The main advantage of trading using opposite Chaozhou Three-circle and Sinofibers Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chaozhou Three-circle position performs unexpectedly, Sinofibers Technology 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 Sinofibers Technology will offset losses from the drop in Sinofibers Technology's long position.The idea behind Chaozhou Three circle Group and Sinofibers Technology Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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