Correlation Between King Strong and Suzhou Xingye
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By analyzing existing cross correlation between King Strong New Material and Suzhou Xingye Material, you can compare the effects of market volatilities on King Strong and Suzhou Xingye 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 King Strong with a short position of Suzhou Xingye. Check out your portfolio center. Please also check ongoing floating volatility patterns of King Strong and Suzhou Xingye.
Diversification Opportunities for King Strong and Suzhou Xingye
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between King and Suzhou is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding King Strong New Material and Suzhou Xingye Material in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suzhou Xingye Material and King Strong 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 King Strong New Material are associated (or correlated) with Suzhou Xingye. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suzhou Xingye Material has no effect on the direction of King Strong i.e., King Strong and Suzhou Xingye go up and down completely randomly.
Pair Corralation between King Strong and Suzhou Xingye
Assuming the 90 days trading horizon King Strong New Material is expected to generate 0.91 times more return on investment than Suzhou Xingye. However, King Strong New Material is 1.09 times less risky than Suzhou Xingye. It trades about 0.06 of its potential returns per unit of risk. Suzhou Xingye Material is currently generating about 0.01 per unit of risk. If you would invest 1,572 in King Strong New Material on August 28, 2024 and sell it today you would earn a total of 595.00 from holding King Strong New Material or generate 37.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
King Strong New Material vs. Suzhou Xingye Material
Performance |
| Timeline |
| King Strong New |
| Suzhou Xingye Material |
King Strong and Suzhou Xingye Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with King Strong and Suzhou Xingye
The main advantage of trading using opposite King Strong and Suzhou Xingye positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if King Strong position performs unexpectedly, Suzhou Xingye 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 Suzhou Xingye will offset losses from the drop in Suzhou Xingye's long position.| King Strong vs. Rising Nonferrous Metals | King Strong vs. Qinghaihuading Industrial Co | King Strong vs. Western Metal Materials | King Strong vs. Shenzhen Zhongzhuang Construction |
| Suzhou Xingye vs. Guosheng Financial Holding | Suzhou Xingye vs. Industrial Bank Co | Suzhou Xingye vs. HeBei Jinniu Chemical | Suzhou Xingye vs. Jilin Chemical Fibre |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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