Correlation Between Sinomach Automobile and SUNSEA Telecommunicatio
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By analyzing existing cross correlation between Sinomach Automobile Co and SUNSEA Telecommunications Co, you can compare the effects of market volatilities on Sinomach Automobile and SUNSEA Telecommunicatio 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 SUNSEA Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sinomach Automobile and SUNSEA Telecommunicatio.
Diversification Opportunities for Sinomach Automobile and SUNSEA Telecommunicatio
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Sinomach and SUNSEA is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Sinomach Automobile Co and SUNSEA Telecommunications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUNSEA Telecommunicatio 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 SUNSEA Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SUNSEA Telecommunicatio has no effect on the direction of Sinomach Automobile i.e., Sinomach Automobile and SUNSEA Telecommunicatio go up and down completely randomly.
Pair Corralation between Sinomach Automobile and SUNSEA Telecommunicatio
Assuming the 90 days trading horizon Sinomach Automobile is expected to generate 1.89 times less return on investment than SUNSEA Telecommunicatio. But when comparing it to its historical volatility, Sinomach Automobile Co is 1.44 times less risky than SUNSEA Telecommunicatio. It trades about 0.14 of its potential returns per unit of risk. SUNSEA Telecommunications Co is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 568.00 in SUNSEA Telecommunications Co on August 28, 2024 and sell it today you would earn a total of 268.00 from holding SUNSEA Telecommunications Co or generate 47.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sinomach Automobile Co vs. SUNSEA Telecommunications Co
Performance |
| Timeline |
| Sinomach Automobile |
| SUNSEA Telecommunicatio |
Sinomach Automobile and SUNSEA Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sinomach Automobile and SUNSEA Telecommunicatio
The main advantage of trading using opposite Sinomach Automobile and SUNSEA Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sinomach Automobile position performs unexpectedly, SUNSEA Telecommunicatio 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 SUNSEA Telecommunicatio will offset losses from the drop in SUNSEA Telecommunicatio's long position.| Sinomach Automobile vs. Citic Guoan Wine | Sinomach Automobile vs. Milkyway Chemical Supply | Sinomach Automobile vs. Easyhome New Retail | Sinomach Automobile vs. Sunny Loan Top |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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