Correlation Between Dongfeng Automobile and Smartgiant Technology
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By analyzing existing cross correlation between Dongfeng Automobile Co and Smartgiant Technology Co, you can compare the effects of market volatilities on Dongfeng Automobile and Smartgiant Technology 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 Dongfeng Automobile with a short position of Smartgiant Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongfeng Automobile and Smartgiant Technology.
Diversification Opportunities for Dongfeng Automobile and Smartgiant Technology
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Dongfeng and Smartgiant is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Dongfeng Automobile Co and Smartgiant Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smartgiant Technology and Dongfeng Automobile 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 Dongfeng Automobile Co are associated (or correlated) with Smartgiant Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smartgiant Technology has no effect on the direction of Dongfeng Automobile i.e., Dongfeng Automobile and Smartgiant Technology go up and down completely randomly.
Pair Corralation between Dongfeng Automobile and Smartgiant Technology
Assuming the 90 days trading horizon Dongfeng Automobile Co is expected to under-perform the Smartgiant Technology. But the stock apears to be less risky and, when comparing its historical volatility, Dongfeng Automobile Co is 1.03 times less risky than Smartgiant Technology. The stock trades about -0.18 of its potential returns per unit of risk. The Smartgiant Technology Co is currently generating about -0.15 of returns per unit of risk over similar time horizon. If you would invest 4,391 in Smartgiant Technology Co on October 28, 2024 and sell it today you would lose (431.00) from holding Smartgiant Technology Co or give up 9.82% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongfeng Automobile Co vs. Smartgiant Technology Co
Performance |
| Timeline |
| Dongfeng Automobile |
| Smartgiant Technology |
Dongfeng Automobile and Smartgiant Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongfeng Automobile and Smartgiant Technology
The main advantage of trading using opposite Dongfeng Automobile and Smartgiant Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongfeng Automobile position performs unexpectedly, Smartgiant Technology 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 Smartgiant Technology will offset losses from the drop in Smartgiant Technology's long position.| Dongfeng Automobile vs. StarPower Semiconductor | Dongfeng Automobile vs. Fujian Longzhou Transportation | Dongfeng Automobile vs. Thinkon Semiconductor Jinzhou | Dongfeng Automobile vs. Will Semiconductor Co |
| Smartgiant Technology vs. V V Food | Smartgiant Technology vs. Jiajia Food Group | Smartgiant Technology vs. Omnijoi Media Corp | Smartgiant Technology vs. Shanghai Xinhua Media |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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