Correlation Between Sinofibers Technology and Shenzhen Transsion
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By analyzing existing cross correlation between Sinofibers Technology Co and Shenzhen Transsion Holdings, you can compare the effects of market volatilities on Sinofibers Technology and Shenzhen Transsion 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 Sinofibers Technology with a short position of Shenzhen Transsion. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sinofibers Technology and Shenzhen Transsion.
Diversification Opportunities for Sinofibers Technology and Shenzhen Transsion
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sinofibers and Shenzhen is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Sinofibers Technology Co and Shenzhen Transsion Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Transsion and Sinofibers Technology 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 Sinofibers Technology Co are associated (or correlated) with Shenzhen Transsion. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Transsion has no effect on the direction of Sinofibers Technology i.e., Sinofibers Technology and Shenzhen Transsion go up and down completely randomly.
Pair Corralation between Sinofibers Technology and Shenzhen Transsion
Assuming the 90 days trading horizon Sinofibers Technology Co is expected to under-perform the Shenzhen Transsion. But the stock apears to be less risky and, when comparing its historical volatility, Sinofibers Technology Co is 1.29 times less risky than Shenzhen Transsion. The stock trades about -0.02 of its potential returns per unit of risk. The Shenzhen Transsion Holdings is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 7,362 in Shenzhen Transsion Holdings on September 13, 2024 and sell it today you would earn a total of 2,144 from holding Shenzhen Transsion Holdings or generate 29.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sinofibers Technology Co vs. Shenzhen Transsion Holdings
Performance |
| Timeline |
| Sinofibers Technology |
| Shenzhen Transsion |
Sinofibers Technology and Shenzhen Transsion Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sinofibers Technology and Shenzhen Transsion
The main advantage of trading using opposite Sinofibers Technology and Shenzhen Transsion positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sinofibers Technology position performs unexpectedly, Shenzhen Transsion 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 Shenzhen Transsion will offset losses from the drop in Shenzhen Transsion's long position.| Sinofibers Technology vs. Zijin Mining Group | Sinofibers Technology vs. Wanhua Chemical Group | Sinofibers Technology vs. Baoshan Iron Steel | Sinofibers Technology vs. Shandong Gold Mining |
| Shenzhen Transsion vs. Jilin Jlu Communication | Shenzhen Transsion vs. Anhui Transport Consulting | Shenzhen Transsion vs. Western Metal Materials | Shenzhen Transsion vs. State Grid InformationCommunication |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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