Correlation Between Sinomach General and Dongjiang Environmental
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By analyzing existing cross correlation between Sinomach General Machinery and Dongjiang Environmental Co, you can compare the effects of market volatilities on Sinomach General and Dongjiang Environmental 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 Dongjiang Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sinomach General and Dongjiang Environmental.
Diversification Opportunities for Sinomach General and Dongjiang Environmental
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Sinomach and Dongjiang is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Sinomach General Machinery and Dongjiang Environmental Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongjiang Environmental 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 Dongjiang Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongjiang Environmental has no effect on the direction of Sinomach General i.e., Sinomach General and Dongjiang Environmental go up and down completely randomly.
Pair Corralation between Sinomach General and Dongjiang Environmental
Assuming the 90 days trading horizon Sinomach General Machinery is expected to generate 1.23 times more return on investment than Dongjiang Environmental. However, Sinomach General is 1.23 times more volatile than Dongjiang Environmental Co. It trades about 0.19 of its potential returns per unit of risk. Dongjiang Environmental Co is currently generating about 0.21 per unit of risk. If you would invest 1,134 in Sinomach General Machinery on September 12, 2024 and sell it today you would earn a total of 548.00 from holding Sinomach General Machinery or generate 48.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sinomach General Machinery vs. Dongjiang Environmental Co
Performance |
| Timeline |
| Sinomach General Mac |
| Dongjiang Environmental |
Sinomach General and Dongjiang Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sinomach General and Dongjiang Environmental
The main advantage of trading using opposite Sinomach General and Dongjiang Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sinomach General position performs unexpectedly, Dongjiang Environmental 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 Dongjiang Environmental will offset losses from the drop in Dongjiang Environmental's long position.| Sinomach General vs. Agricultural Bank of | Sinomach General vs. Industrial and Commercial | Sinomach General vs. Bank of China | Sinomach General vs. PetroChina Co Ltd |
| Dongjiang Environmental vs. Agricultural Bank of | Dongjiang Environmental vs. Industrial and Commercial | Dongjiang Environmental vs. Bank of China | Dongjiang Environmental vs. PetroChina Co Ltd |
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 CEOs Directory module to screen CEOs from public companies around the world.
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