Correlation Between Wintao Communications and Yangmei Chemical
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By analyzing existing cross correlation between Wintao Communications Co and Yangmei Chemical Co, you can compare the effects of market volatilities on Wintao Communications and Yangmei Chemical 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 Wintao Communications with a short position of Yangmei Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wintao Communications and Yangmei Chemical.
Diversification Opportunities for Wintao Communications and Yangmei Chemical
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Wintao and Yangmei is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Wintao Communications Co and Yangmei Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yangmei Chemical and Wintao Communications 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 Wintao Communications Co are associated (or correlated) with Yangmei Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yangmei Chemical has no effect on the direction of Wintao Communications i.e., Wintao Communications and Yangmei Chemical go up and down completely randomly.
Pair Corralation between Wintao Communications and Yangmei Chemical
Assuming the 90 days trading horizon Wintao Communications is expected to generate 1.91 times less return on investment than Yangmei Chemical. But when comparing it to its historical volatility, Wintao Communications Co is 1.06 times less risky than Yangmei Chemical. It trades about 0.16 of its potential returns per unit of risk. Yangmei Chemical Co is currently generating about 0.29 of returns per unit of risk over similar time horizon. If you would invest 152.00 in Yangmei Chemical Co on September 12, 2024 and sell it today you would earn a total of 136.00 from holding Yangmei Chemical Co or generate 89.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wintao Communications Co vs. Yangmei Chemical Co
Performance |
| Timeline |
| Wintao Communications |
| Yangmei Chemical |
Wintao Communications and Yangmei Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wintao Communications and Yangmei Chemical
The main advantage of trading using opposite Wintao Communications and Yangmei Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wintao Communications position performs unexpectedly, Yangmei Chemical 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 Yangmei Chemical will offset losses from the drop in Yangmei Chemical's long position.| Wintao Communications vs. Industrial and Commercial | Wintao Communications vs. China Construction Bank | Wintao Communications vs. Agricultural Bank of | Wintao Communications vs. Bank of China |
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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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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