Correlation Between China World and Shenzhen
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By analyzing existing cross correlation between China World Trade and Shenzhen AV Display Co, you can compare the effects of market volatilities on China World and Shenzhen 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 China World with a short position of Shenzhen. Check out your portfolio center. Please also check ongoing floating volatility patterns of China World and Shenzhen.
Diversification Opportunities for China World and Shenzhen
0.06 | Correlation Coefficient |
Significant diversification
The 3 months correlation between China and Shenzhen is 0.06. Overlapping area represents the amount of risk that can be diversified away by holding China World Trade and Shenzhen AV Display Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen AV Display and China World 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 China World Trade are associated (or correlated) with Shenzhen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen AV Display has no effect on the direction of China World i.e., China World and Shenzhen go up and down completely randomly.
Pair Corralation between China World and Shenzhen
Assuming the 90 days trading horizon China World Trade is expected to generate 0.43 times more return on investment than Shenzhen. However, China World Trade is 2.3 times less risky than Shenzhen. It trades about 0.14 of its potential returns per unit of risk. Shenzhen AV Display Co is currently generating about -0.03 per unit of risk. If you would invest 2,419 in China World Trade on November 3, 2024 and sell it today you would earn a total of 77.00 from holding China World Trade or generate 3.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China World Trade vs. Shenzhen AV Display Co
Performance |
| Timeline |
| China World Trade |
| Shenzhen AV Display |
China World and Shenzhen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China World and Shenzhen
The main advantage of trading using opposite China World and Shenzhen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China World position performs unexpectedly, Shenzhen 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 will offset losses from the drop in Shenzhen's long position.| China World vs. Quectel Wireless Solutions | China World vs. Chengdu B ray Media | China World vs. Fibocom Wireless | China World vs. Tongyu Communication |
| Shenzhen vs. Nanjing Putian Telecommunications | Shenzhen vs. Liuzhou Chemical Industry | Shenzhen vs. Xilong Chemical Co | Shenzhen vs. China Life Insurance |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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