Correlation Between Shenzhen Bingchuan and Allwin Telecommunicatio
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By analyzing existing cross correlation between Shenzhen Bingchuan Network and Allwin Telecommunication Co, you can compare the effects of market volatilities on Shenzhen Bingchuan and Allwin Telecommunicatio 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 Bingchuan with a short position of Allwin Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Bingchuan and Allwin Telecommunicatio.
Diversification Opportunities for Shenzhen Bingchuan and Allwin Telecommunicatio
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shenzhen and Allwin is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Bingchuan Network and Allwin Telecommunication Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allwin Telecommunicatio and Shenzhen Bingchuan 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 Bingchuan Network are associated (or correlated) with Allwin Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allwin Telecommunicatio has no effect on the direction of Shenzhen Bingchuan i.e., Shenzhen Bingchuan and Allwin Telecommunicatio go up and down completely randomly.
Pair Corralation between Shenzhen Bingchuan and Allwin Telecommunicatio
Assuming the 90 days trading horizon Shenzhen Bingchuan Network is expected to generate 1.24 times more return on investment than Allwin Telecommunicatio. However, Shenzhen Bingchuan is 1.24 times more volatile than Allwin Telecommunication Co. It trades about 0.27 of its potential returns per unit of risk. Allwin Telecommunication Co is currently generating about -0.13 per unit of risk. If you would invest 1,923 in Shenzhen Bingchuan Network on August 29, 2024 and sell it today you would earn a total of 564.00 from holding Shenzhen Bingchuan Network or generate 29.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Bingchuan Network vs. Allwin Telecommunication Co
Performance |
| Timeline |
| Shenzhen Bingchuan |
| Allwin Telecommunicatio |
Shenzhen Bingchuan and Allwin Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Bingchuan and Allwin Telecommunicatio
The main advantage of trading using opposite Shenzhen Bingchuan and Allwin Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Bingchuan position performs unexpectedly, Allwin Telecommunicatio 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 Allwin Telecommunicatio will offset losses from the drop in Allwin Telecommunicatio's long position.| Shenzhen Bingchuan vs. GreenTech Environmental Co | Shenzhen Bingchuan vs. Ningbo MedicalSystem Biotechnology | Shenzhen Bingchuan vs. Hang Xiao Steel | Shenzhen Bingchuan vs. Guangdong Liantai Environmental |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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