Correlation Between Dongguan Tarry and Suzhou Douson
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By analyzing existing cross correlation between Dongguan Tarry Electronics and Suzhou Douson Drilling, you can compare the effects of market volatilities on Dongguan Tarry and Suzhou Douson 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 Dongguan Tarry with a short position of Suzhou Douson. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongguan Tarry and Suzhou Douson.
Diversification Opportunities for Dongguan Tarry and Suzhou Douson
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Dongguan and Suzhou is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Dongguan Tarry Electronics and Suzhou Douson Drilling in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suzhou Douson Drilling and Dongguan Tarry 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 Dongguan Tarry Electronics are associated (or correlated) with Suzhou Douson. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suzhou Douson Drilling has no effect on the direction of Dongguan Tarry i.e., Dongguan Tarry and Suzhou Douson go up and down completely randomly.
Pair Corralation between Dongguan Tarry and Suzhou Douson
Assuming the 90 days trading horizon Dongguan Tarry Electronics is expected to under-perform the Suzhou Douson. But the stock apears to be less risky and, when comparing its historical volatility, Dongguan Tarry Electronics is 1.1 times less risky than Suzhou Douson. The stock trades about -0.09 of its potential returns per unit of risk. The Suzhou Douson Drilling is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 2,506 in Suzhou Douson Drilling on October 28, 2024 and sell it today you would lose (35.00) from holding Suzhou Douson Drilling or give up 1.4% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongguan Tarry Electronics vs. Suzhou Douson Drilling
Performance |
| Timeline |
| Dongguan Tarry Elect |
| Suzhou Douson Drilling |
Dongguan Tarry and Suzhou Douson Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongguan Tarry and Suzhou Douson
The main advantage of trading using opposite Dongguan Tarry and Suzhou Douson positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongguan Tarry position performs unexpectedly, Suzhou Douson 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 Douson will offset losses from the drop in Suzhou Douson's long position.| Dongguan Tarry vs. Xiandai Investment Co | Dongguan Tarry vs. Hubei Tech Semiconductors | Dongguan Tarry vs. Union Semiconductor Co | Dongguan Tarry vs. China Asset Management |
| Suzhou Douson vs. Zhejiang Kingland Pipeline | Suzhou Douson vs. Quectel Wireless Solutions | Suzhou Douson vs. Linkage Software Co | Suzhou Douson vs. Hainan HNA Infrastructure |
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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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