Correlation Between Yingde Greatchem and China Satellite
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By analyzing existing cross correlation between Yingde Greatchem Chemicals and China Satellite Communications, you can compare the effects of market volatilities on Yingde Greatchem and China Satellite 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 Yingde Greatchem with a short position of China Satellite. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yingde Greatchem and China Satellite.
Diversification Opportunities for Yingde Greatchem and China Satellite
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Yingde and China is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Yingde Greatchem Chemicals and China Satellite Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Satellite Comm and Yingde Greatchem 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 Yingde Greatchem Chemicals are associated (or correlated) with China Satellite. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Satellite Comm has no effect on the direction of Yingde Greatchem i.e., Yingde Greatchem and China Satellite go up and down completely randomly.
Pair Corralation between Yingde Greatchem and China Satellite
Assuming the 90 days trading horizon Yingde Greatchem Chemicals is expected to under-perform the China Satellite. But the stock apears to be less risky and, when comparing its historical volatility, Yingde Greatchem Chemicals is 1.07 times less risky than China Satellite. The stock trades about -0.03 of its potential returns per unit of risk. The China Satellite Communications is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,239 in China Satellite Communications on October 16, 2024 and sell it today you would earn a total of 655.00 from holding China Satellite Communications or generate 52.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 79.08% |
| Values | Daily Returns |
Yingde Greatchem Chemicals vs. China Satellite Communications
Performance |
| Timeline |
| Yingde Greatchem Che |
| China Satellite Comm |
Yingde Greatchem and China Satellite Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yingde Greatchem and China Satellite
The main advantage of trading using opposite Yingde Greatchem and China Satellite positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yingde Greatchem position performs unexpectedly, China Satellite 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 China Satellite will offset losses from the drop in China Satellite's long position.| Yingde Greatchem vs. Guangdong Qunxing Toys | Yingde Greatchem vs. Longjian Road Bridge | Yingde Greatchem vs. Fujian Longzhou Transportation | Yingde Greatchem vs. Road Environment Technology |
| China Satellite vs. Dymatic Chemicals | China Satellite vs. Yingde Greatchem Chemicals | China Satellite vs. Caihong Display Devices | China Satellite vs. Anhui Jianghuai Automobile |
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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