Correlation Between Shenzhen and Fujian Newland
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By analyzing existing cross correlation between Shenzhen AV Display Co and Fujian Newland Computer, you can compare the effects of market volatilities on Shenzhen and Fujian Newland 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 Shenzhen with a short position of Fujian Newland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen and Fujian Newland.
Diversification Opportunities for Shenzhen and Fujian Newland
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shenzhen and Fujian is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen AV Display Co and Fujian Newland Computer in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fujian Newland Computer and Shenzhen 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 Shenzhen AV Display Co are associated (or correlated) with Fujian Newland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fujian Newland Computer has no effect on the direction of Shenzhen i.e., Shenzhen and Fujian Newland go up and down completely randomly.
Pair Corralation between Shenzhen and Fujian Newland
Assuming the 90 days trading horizon Shenzhen is expected to generate 1.35 times less return on investment than Fujian Newland. In addition to that, Shenzhen is 1.36 times more volatile than Fujian Newland Computer. It trades about 0.02 of its total potential returns per unit of risk. Fujian Newland Computer is currently generating about 0.04 per unit of volatility. If you would invest 1,423 in Fujian Newland Computer on October 27, 2024 and sell it today you would earn a total of 576.00 from holding Fujian Newland Computer or generate 40.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen AV Display Co vs. Fujian Newland Computer
Performance |
| Timeline |
| Shenzhen AV Display |
| Fujian Newland Computer |
Shenzhen and Fujian Newland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen and Fujian Newland
The main advantage of trading using opposite Shenzhen and Fujian Newland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen position performs unexpectedly, Fujian Newland 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 Fujian Newland will offset losses from the drop in Fujian Newland's long position.| Shenzhen vs. Yindu Kitchen Equipment | Shenzhen vs. Beijing Bewinner Communications | Shenzhen vs. Bank of Communications | Shenzhen vs. Aba Chemicals Corp |
| Fujian Newland vs. Shantui Construction Machinery | Fujian Newland vs. Senci Electric Machinery | Fujian Newland vs. Linzhou Heavy Machinery | Fujian Newland vs. Fujian Oriental Silver |
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 Anywhere module to track or share privately all of your investments from the convenience of any device.
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