Correlation Between Dongnan Electronics and Shenzhen Inovance
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By analyzing existing cross correlation between Dongnan Electronics Co and Shenzhen Inovance Tech, you can compare the effects of market volatilities on Dongnan Electronics and Shenzhen Inovance 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 Dongnan Electronics with a short position of Shenzhen Inovance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongnan Electronics and Shenzhen Inovance.
Diversification Opportunities for Dongnan Electronics and Shenzhen Inovance
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dongnan and Shenzhen is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Dongnan Electronics Co and Shenzhen Inovance Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Inovance Tech and Dongnan Electronics 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 Dongnan Electronics Co are associated (or correlated) with Shenzhen Inovance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Inovance Tech has no effect on the direction of Dongnan Electronics i.e., Dongnan Electronics and Shenzhen Inovance go up and down completely randomly.
Pair Corralation between Dongnan Electronics and Shenzhen Inovance
Assuming the 90 days trading horizon Dongnan Electronics is expected to generate 28.19 times less return on investment than Shenzhen Inovance. In addition to that, Dongnan Electronics is 1.65 times more volatile than Shenzhen Inovance Tech. It trades about 0.0 of its total potential returns per unit of risk. Shenzhen Inovance Tech is currently generating about 0.05 per unit of volatility. If you would invest 5,706 in Shenzhen Inovance Tech on October 15, 2024 and sell it today you would earn a total of 293.00 from holding Shenzhen Inovance Tech or generate 5.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongnan Electronics Co vs. Shenzhen Inovance Tech
Performance |
| Timeline |
| Dongnan Electronics |
| Shenzhen Inovance Tech |
Dongnan Electronics and Shenzhen Inovance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongnan Electronics and Shenzhen Inovance
The main advantage of trading using opposite Dongnan Electronics and Shenzhen Inovance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongnan Electronics position performs unexpectedly, Shenzhen Inovance 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 Shenzhen Inovance will offset losses from the drop in Shenzhen Inovance's long position.| Dongnan Electronics vs. Agricultural Bank of | Dongnan Electronics vs. Juneyao Airlines | Dongnan Electronics vs. Xiamen Bank Co | Dongnan Electronics vs. GRG Banking Equipment |
| Shenzhen Inovance vs. Rising Nonferrous Metals | Shenzhen Inovance vs. Tibet Huayu Mining | Shenzhen Inovance vs. Beijing Jiaman Dress | Shenzhen Inovance vs. Anhui Jinhe Industrial |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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