Correlation Between Kailong High and East Money
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By analyzing existing cross correlation between Kailong High Technology and East Money Information, you can compare the effects of market volatilities on Kailong High and East Money 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 Kailong High with a short position of East Money. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kailong High and East Money.
Diversification Opportunities for Kailong High and East Money
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kailong and East is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Kailong High Technology and East Money Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on East Money Information and Kailong High 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 Kailong High Technology are associated (or correlated) with East Money. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of East Money Information has no effect on the direction of Kailong High i.e., Kailong High and East Money go up and down completely randomly.
Pair Corralation between Kailong High and East Money
Assuming the 90 days trading horizon Kailong High Technology is expected to generate 1.27 times more return on investment than East Money. However, Kailong High is 1.27 times more volatile than East Money Information. It trades about 0.25 of its potential returns per unit of risk. East Money Information is currently generating about 0.05 per unit of risk. If you would invest 1,040 in Kailong High Technology on November 7, 2024 and sell it today you would earn a total of 146.00 from holding Kailong High Technology or generate 14.04% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kailong High Technology vs. East Money Information
Performance |
| Timeline |
| Kailong High Technology |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| East Money Information |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Kailong High and East Money Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kailong High and East Money
The main advantage of trading using opposite Kailong High and East Money positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kailong High position performs unexpectedly, East Money 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 East Money will offset losses from the drop in East Money's long position.The idea behind Kailong High Technology and East Money Information pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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