Correlation Between Sublime China and Hangzhou Pinming
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By analyzing existing cross correlation between Sublime China Information and Hangzhou Pinming Software, you can compare the effects of market volatilities on Sublime China and Hangzhou Pinming 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 Sublime China with a short position of Hangzhou Pinming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sublime China and Hangzhou Pinming.
Diversification Opportunities for Sublime China and Hangzhou Pinming
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Sublime and Hangzhou is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Sublime China Information and Hangzhou Pinming Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hangzhou Pinming Software and Sublime China 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 Sublime China Information are associated (or correlated) with Hangzhou Pinming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hangzhou Pinming Software has no effect on the direction of Sublime China i.e., Sublime China and Hangzhou Pinming go up and down completely randomly.
Pair Corralation between Sublime China and Hangzhou Pinming
Assuming the 90 days trading horizon Sublime China Information is expected to generate 3.12 times more return on investment than Hangzhou Pinming. However, Sublime China is 3.12 times more volatile than Hangzhou Pinming Software. It trades about 0.34 of its potential returns per unit of risk. Hangzhou Pinming Software is currently generating about 0.45 per unit of risk. If you would invest 5,733 in Sublime China Information on November 7, 2024 and sell it today you would earn a total of 2,275 from holding Sublime China Information or generate 39.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sublime China Information vs. Hangzhou Pinming Software
Performance |
| Timeline |
| Sublime China Information |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
OK
| Hangzhou Pinming Software |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Sublime China and Hangzhou Pinming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sublime China and Hangzhou Pinming
The main advantage of trading using opposite Sublime China and Hangzhou Pinming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sublime China position performs unexpectedly, Hangzhou Pinming 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 Hangzhou Pinming will offset losses from the drop in Hangzhou Pinming's long position.The idea behind Sublime China Information and Hangzhou Pinming Software 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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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