Correlation Between Wintao Communications and Yuanjie Semiconductor
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By analyzing existing cross correlation between Wintao Communications Co and Yuanjie Semiconductor Technology, you can compare the effects of market volatilities on Wintao Communications and Yuanjie Semiconductor 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 Yuanjie Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wintao Communications and Yuanjie Semiconductor.
Diversification Opportunities for Wintao Communications and Yuanjie Semiconductor
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Wintao and Yuanjie is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Wintao Communications Co and Yuanjie Semiconductor Technolo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yuanjie Semiconductor 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 Yuanjie Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yuanjie Semiconductor has no effect on the direction of Wintao Communications i.e., Wintao Communications and Yuanjie Semiconductor go up and down completely randomly.
Pair Corralation between Wintao Communications and Yuanjie Semiconductor
Assuming the 90 days trading horizon Wintao Communications is expected to generate 10.07 times less return on investment than Yuanjie Semiconductor. But when comparing it to its historical volatility, Wintao Communications Co is 1.39 times less risky than Yuanjie Semiconductor. It trades about 0.01 of its potential returns per unit of risk. Yuanjie Semiconductor Technology is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 10,632 in Yuanjie Semiconductor Technology on November 7, 2024 and sell it today you would earn a total of 3,929 from holding Yuanjie Semiconductor Technology or generate 36.95% 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. Yuanjie Semiconductor Technolo
Performance |
| Timeline |
| Wintao Communications |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Yuanjie Semiconductor |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Wintao Communications and Yuanjie Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wintao Communications and Yuanjie Semiconductor
The main advantage of trading using opposite Wintao Communications and Yuanjie Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wintao Communications position performs unexpectedly, Yuanjie Semiconductor 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 Yuanjie Semiconductor will offset losses from the drop in Yuanjie Semiconductor's long position.The idea behind Wintao Communications Co and Yuanjie Semiconductor Technology 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.
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