Correlation Between Sinomach General and Cathay Biotech
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By analyzing existing cross correlation between Sinomach General Machinery and Cathay Biotech, you can compare the effects of market volatilities on Sinomach General and Cathay Biotech 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 Cathay Biotech. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sinomach General and Cathay Biotech.
Diversification Opportunities for Sinomach General and Cathay Biotech
0.35 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Sinomach and Cathay is 0.35. Overlapping area represents the amount of risk that can be diversified away by holding Sinomach General Machinery and Cathay Biotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cathay Biotech 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 Cathay Biotech. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cathay Biotech has no effect on the direction of Sinomach General i.e., Sinomach General and Cathay Biotech go up and down completely randomly.
Pair Corralation between Sinomach General and Cathay Biotech
Assuming the 90 days trading horizon Sinomach General Machinery is expected to under-perform the Cathay Biotech. In addition to that, Sinomach General is 2.08 times more volatile than Cathay Biotech. It trades about -0.35 of its total potential returns per unit of risk. Cathay Biotech is currently generating about -0.59 per unit of volatility. If you would invest 4,481 in Cathay Biotech on October 9, 2024 and sell it today you would lose (590.00) from holding Cathay Biotech or give up 13.17% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sinomach General Machinery vs. Cathay Biotech
Performance |
| Timeline |
| Sinomach General Mac |
| Cathay Biotech |
Sinomach General and Cathay Biotech Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sinomach General and Cathay Biotech
The main advantage of trading using opposite Sinomach General and Cathay Biotech positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sinomach General position performs unexpectedly, Cathay Biotech 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 Cathay Biotech will offset losses from the drop in Cathay Biotech's long position.| Sinomach General vs. Kweichow Moutai Co | Sinomach General vs. Contemporary Amperex Technology | Sinomach General vs. G bits Network Technology | Sinomach General vs. Beijing Roborock Technology |
| Cathay Biotech vs. LianChuang Electronic Technology | Cathay Biotech vs. HaiXin Foods Co | Cathay Biotech vs. Beijing YanDong MicroElectronic | Cathay Biotech vs. Marssenger Kitchenware Co |
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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