Correlation Between Sinomach Automobile and Rongan Property
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By analyzing existing cross correlation between Sinomach Automobile Co and Rongan Property Co, you can compare the effects of market volatilities on Sinomach Automobile and Rongan Property 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 Sinomach Automobile with a short position of Rongan Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sinomach Automobile and Rongan Property.
Diversification Opportunities for Sinomach Automobile and Rongan Property
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sinomach and Rongan is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Sinomach Automobile Co and Rongan Property Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rongan Property and Sinomach 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 Sinomach Automobile Co are associated (or correlated) with Rongan Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rongan Property has no effect on the direction of Sinomach Automobile i.e., Sinomach Automobile and Rongan Property go up and down completely randomly.
Pair Corralation between Sinomach Automobile and Rongan Property
Assuming the 90 days trading horizon Sinomach Automobile Co is expected to generate 0.66 times more return on investment than Rongan Property. However, Sinomach Automobile Co is 1.51 times less risky than Rongan Property. It trades about 0.24 of its potential returns per unit of risk. Rongan Property Co is currently generating about -0.21 per unit of risk. If you would invest 592.00 in Sinomach Automobile Co on November 4, 2024 and sell it today you would earn a total of 46.00 from holding Sinomach Automobile Co or generate 7.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sinomach Automobile Co vs. Rongan Property Co
Performance |
| Timeline |
| Sinomach Automobile |
| Rongan Property |
Sinomach Automobile and Rongan Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sinomach Automobile and Rongan Property
The main advantage of trading using opposite Sinomach Automobile and Rongan Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sinomach Automobile position performs unexpectedly, Rongan Property 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 Rongan Property will offset losses from the drop in Rongan Property's long position.| Sinomach Automobile vs. GRG Banking Equipment | Sinomach Automobile vs. Montage Technology Co | Sinomach Automobile vs. Dr Peng Telecom | Sinomach Automobile vs. Holitech Technology Co |
| Rongan Property vs. Kunshan Dongwei Technology | Rongan Property vs. Qingdao Foods Co | Rongan Property vs. Soyea Technology Co | Rongan Property vs. New Hope Dairy |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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