Correlation Between Wintao Communications and GigaDevice SemiconductorBei
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By analyzing existing cross correlation between Wintao Communications Co and GigaDevice SemiconductorBeiji, you can compare the effects of market volatilities on Wintao Communications and GigaDevice SemiconductorBei 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 GigaDevice SemiconductorBei. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wintao Communications and GigaDevice SemiconductorBei.
Diversification Opportunities for Wintao Communications and GigaDevice SemiconductorBei
-0.65 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Wintao and GigaDevice is -0.65. Overlapping area represents the amount of risk that can be diversified away by holding Wintao Communications Co and GigaDevice SemiconductorBeiji in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on GigaDevice SemiconductorBei 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 GigaDevice SemiconductorBei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of GigaDevice SemiconductorBei has no effect on the direction of Wintao Communications i.e., Wintao Communications and GigaDevice SemiconductorBei go up and down completely randomly.
Pair Corralation between Wintao Communications and GigaDevice SemiconductorBei
Assuming the 90 days trading horizon Wintao Communications Co is expected to under-perform the GigaDevice SemiconductorBei. In addition to that, Wintao Communications is 1.19 times more volatile than GigaDevice SemiconductorBeiji. It trades about -0.03 of its total potential returns per unit of risk. GigaDevice SemiconductorBeiji is currently generating about 0.05 per unit of volatility. If you would invest 9,290 in GigaDevice SemiconductorBeiji on November 5, 2024 and sell it today you would earn a total of 3,450 from holding GigaDevice SemiconductorBeiji or generate 37.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wintao Communications Co vs. GigaDevice SemiconductorBeiji
Performance |
| Timeline |
| Wintao Communications |
| GigaDevice SemiconductorBei |
Wintao Communications and GigaDevice SemiconductorBei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wintao Communications and GigaDevice SemiconductorBei
The main advantage of trading using opposite Wintao Communications and GigaDevice SemiconductorBei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wintao Communications position performs unexpectedly, GigaDevice SemiconductorBei 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 GigaDevice SemiconductorBei will offset losses from the drop in GigaDevice SemiconductorBei's long position.The idea behind Wintao Communications Co and GigaDevice SemiconductorBeiji 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 Stocks Directory module to find actively traded stocks across global markets.
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