Correlation Between King Strong and Liaoning Chengda
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By analyzing existing cross correlation between King Strong New Material and Liaoning Chengda Biotechnology, you can compare the effects of market volatilities on King Strong and Liaoning Chengda 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 Liaoning Chengda. Check out your portfolio center. Please also check ongoing floating volatility patterns of King Strong and Liaoning Chengda.
Diversification Opportunities for King Strong and Liaoning Chengda
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between King and Liaoning is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding King Strong New Material and Liaoning Chengda Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liaoning Chengda Bio 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 Liaoning Chengda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liaoning Chengda Bio has no effect on the direction of King Strong i.e., King Strong and Liaoning Chengda go up and down completely randomly.
Pair Corralation between King Strong and Liaoning Chengda
Assuming the 90 days trading horizon King Strong New Material is expected to under-perform the Liaoning Chengda. In addition to that, King Strong is 2.13 times more volatile than Liaoning Chengda Biotechnology. It trades about -0.18 of its total potential returns per unit of risk. Liaoning Chengda Biotechnology is currently generating about -0.1 per unit of volatility. If you would invest 2,732 in Liaoning Chengda Biotechnology on October 30, 2024 and sell it today you would lose (142.00) from holding Liaoning Chengda Biotechnology or give up 5.2% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
King Strong New Material vs. Liaoning Chengda Biotechnology
Performance |
| Timeline |
| King Strong New |
| Liaoning Chengda Bio |
King Strong and Liaoning Chengda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with King Strong and Liaoning Chengda
The main advantage of trading using opposite King Strong and Liaoning Chengda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if King Strong position performs unexpectedly, Liaoning Chengda 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 Liaoning Chengda will offset losses from the drop in Liaoning Chengda's long position.| King Strong vs. Zhongrun Resources Investment | King Strong vs. GRINM Semiconductor Materials | King Strong vs. Will Semiconductor Co | King Strong vs. Harbin Hatou Investment |
| Liaoning Chengda vs. China Petroleum Chemical | Liaoning Chengda vs. PetroChina Co Ltd | Liaoning Chengda vs. China State Construction | Liaoning Chengda vs. China Railway Group |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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