Correlation Between Shenzhen and Dawning Information
Specify exactly 2 symbols:
By analyzing existing cross correlation between Shenzhen AV Display Co and Dawning Information Industry, you can compare the effects of market volatilities on Shenzhen and Dawning Information 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 Dawning Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen and Dawning Information.
Diversification Opportunities for Shenzhen and Dawning Information
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shenzhen and Dawning is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen AV Display Co and Dawning Information Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dawning Information 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 Dawning Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dawning Information has no effect on the direction of Shenzhen i.e., Shenzhen and Dawning Information go up and down completely randomly.
Pair Corralation between Shenzhen and Dawning Information
Assuming the 90 days trading horizon Shenzhen is expected to generate 2.04 times less return on investment than Dawning Information. But when comparing it to its historical volatility, Shenzhen AV Display Co is 1.41 times less risky than Dawning Information. It trades about 0.12 of its potential returns per unit of risk. Dawning Information Industry is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 6,655 in Dawning Information Industry on November 8, 2024 and sell it today you would earn a total of 555.00 from holding Dawning Information Industry or generate 8.34% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen AV Display Co vs. Dawning Information Industry
Performance |
| Timeline |
| Shenzhen AV Display |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Dawning Information |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Shenzhen and Dawning Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen and Dawning Information
The main advantage of trading using opposite Shenzhen and Dawning Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen position performs unexpectedly, Dawning Information 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 Dawning Information will offset losses from the drop in Dawning Information's long position.The idea behind Shenzhen AV Display Co and Dawning Information Industry 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
Other Complementary Tools
| Portfolio Rebalancing Analyze risk-adjusted returns against different time horizons to find asset-allocation targets | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Risk-Return Analysis View associations between returns expected from investment and the risk you assume | |
| Portfolio File Import Quickly import all of your third-party portfolios from your local drive in csv format |