Correlation Between Sinomach General and China Securities
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By analyzing existing cross correlation between Sinomach General Machinery and China Securities 800, you can compare the effects of market volatilities on Sinomach General and China Securities 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 General with a short position of China Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sinomach General and China Securities.
Diversification Opportunities for Sinomach General and China Securities
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sinomach and China is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Sinomach General Machinery and China Securities 800 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Securities 800 and Sinomach General 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 General Machinery are associated (or correlated) with China Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Securities 800 has no effect on the direction of Sinomach General i.e., Sinomach General and China Securities go up and down completely randomly.
Pair Corralation between Sinomach General and China Securities
Assuming the 90 days trading horizon Sinomach General Machinery is expected to generate 2.44 times more return on investment than China Securities. However, Sinomach General is 2.44 times more volatile than China Securities 800. It trades about 0.02 of its potential returns per unit of risk. China Securities 800 is currently generating about 0.04 per unit of risk. If you would invest 1,526 in Sinomach General Machinery on October 30, 2024 and sell it today you would lose (15.00) from holding Sinomach General Machinery or give up 0.98% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sinomach General Machinery vs. China Securities 800
Performance |
| Timeline |
Sinomach General and China Securities Volatility Contrast
Predicted Return Density |
| Returns |
Sinomach General Machinery
Pair trading matchups for Sinomach General
China Securities 800
Pair trading matchups for China Securities
Pair Trading with Sinomach General and China Securities
The main advantage of trading using opposite Sinomach General and China Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sinomach General position performs unexpectedly, China Securities 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 China Securities will offset losses from the drop in China Securities' long position.| Sinomach General vs. Fuzhou Rockchip Electronics | Sinomach General vs. Dongnan Electronics Co | Sinomach General vs. Montage Technology Co | Sinomach General vs. YiDong Electronics Technology |
| China Securities vs. Sinocelltech Group | China Securities vs. Jinhe Biotechnology Co | China Securities vs. Olympic Circuit Technology | China Securities vs. Eyebright Medical Technology |
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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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