Correlation Between Malion New and Dazhong Transportation
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By analyzing existing cross correlation between Malion New Materials and Dazhong Transportation Group, you can compare the effects of market volatilities on Malion New and Dazhong Transportation 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 Malion New with a short position of Dazhong Transportation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Malion New and Dazhong Transportation.
Diversification Opportunities for Malion New and Dazhong Transportation
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Malion and Dazhong is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Malion New Materials and Dazhong Transportation Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dazhong Transportation and Malion New 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 Malion New Materials are associated (or correlated) with Dazhong Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dazhong Transportation has no effect on the direction of Malion New i.e., Malion New and Dazhong Transportation go up and down completely randomly.
Pair Corralation between Malion New and Dazhong Transportation
Assuming the 90 days trading horizon Malion New Materials is expected to generate 2.24 times more return on investment than Dazhong Transportation. However, Malion New is 2.24 times more volatile than Dazhong Transportation Group. It trades about 0.19 of its potential returns per unit of risk. Dazhong Transportation Group is currently generating about 0.08 per unit of risk. If you would invest 815.00 in Malion New Materials on September 1, 2024 and sell it today you would earn a total of 189.00 from holding Malion New Materials or generate 23.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Malion New Materials vs. Dazhong Transportation Group
Performance |
| Timeline |
| Malion New Materials |
| Dazhong Transportation |
Malion New and Dazhong Transportation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Malion New and Dazhong Transportation
The main advantage of trading using opposite Malion New and Dazhong Transportation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Malion New position performs unexpectedly, Dazhong Transportation 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 Dazhong Transportation will offset losses from the drop in Dazhong Transportation's long position.| Malion New vs. Leaguer Shenzhen MicroElectronics | Malion New vs. StarPower Semiconductor | Malion New vs. Integrated Electronic Systems | Malion New vs. Epoxy Base Electronic |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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