Correlation Between Chengdu Kanghua and Suzhou Novoprotein
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By analyzing existing cross correlation between Chengdu Kanghua Biological and Suzhou Novoprotein Scientific, you can compare the effects of market volatilities on Chengdu Kanghua and Suzhou Novoprotein 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 Chengdu Kanghua with a short position of Suzhou Novoprotein. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu Kanghua and Suzhou Novoprotein.
Diversification Opportunities for Chengdu Kanghua and Suzhou Novoprotein
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Chengdu and Suzhou is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu Kanghua Biological and Suzhou Novoprotein Scientific in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suzhou Novoprotein and Chengdu Kanghua 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 Chengdu Kanghua Biological are associated (or correlated) with Suzhou Novoprotein. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suzhou Novoprotein has no effect on the direction of Chengdu Kanghua i.e., Chengdu Kanghua and Suzhou Novoprotein go up and down completely randomly.
Pair Corralation between Chengdu Kanghua and Suzhou Novoprotein
Assuming the 90 days trading horizon Chengdu Kanghua Biological is expected to under-perform the Suzhou Novoprotein. In addition to that, Chengdu Kanghua is 1.23 times more volatile than Suzhou Novoprotein Scientific. It trades about -0.15 of its total potential returns per unit of risk. Suzhou Novoprotein Scientific is currently generating about 0.08 per unit of volatility. If you would invest 3,530 in Suzhou Novoprotein Scientific on August 24, 2024 and sell it today you would earn a total of 118.00 from holding Suzhou Novoprotein Scientific or generate 3.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu Kanghua Biological vs. Suzhou Novoprotein Scientific
Performance |
| Timeline |
| Chengdu Kanghua Biol |
| Suzhou Novoprotein |
Chengdu Kanghua and Suzhou Novoprotein Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu Kanghua and Suzhou Novoprotein
The main advantage of trading using opposite Chengdu Kanghua and Suzhou Novoprotein positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu Kanghua position performs unexpectedly, Suzhou Novoprotein 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 Novoprotein will offset losses from the drop in Suzhou Novoprotein's long position.| Chengdu Kanghua vs. Longmaster Information Tech | Chengdu Kanghua vs. Yonyou Auto Information | Chengdu Kanghua vs. Weichai Heavy Machinery | Chengdu Kanghua vs. Ningbo Construction Co |
| Suzhou Novoprotein vs. Shenzhen MYS Environmental | Suzhou Novoprotein vs. City Development Environment | Suzhou Novoprotein vs. Gansu Jiu Steel | Suzhou Novoprotein vs. Dongfeng Automobile Co |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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