Correlation Between Long Yuan and Dymatic Chemicals
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By analyzing existing cross correlation between Long Yuan Construction and Dymatic Chemicals, you can compare the effects of market volatilities on Long Yuan and Dymatic Chemicals 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 Long Yuan with a short position of Dymatic Chemicals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Long Yuan and Dymatic Chemicals.
Diversification Opportunities for Long Yuan and Dymatic Chemicals
0.41 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Long and Dymatic is 0.41. Overlapping area represents the amount of risk that can be diversified away by holding Long Yuan Construction and Dymatic Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dymatic Chemicals and Long Yuan 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 Long Yuan Construction are associated (or correlated) with Dymatic Chemicals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dymatic Chemicals has no effect on the direction of Long Yuan i.e., Long Yuan and Dymatic Chemicals go up and down completely randomly.
Pair Corralation between Long Yuan and Dymatic Chemicals
Assuming the 90 days trading horizon Long Yuan Construction is expected to generate 1.14 times more return on investment than Dymatic Chemicals. However, Long Yuan is 1.14 times more volatile than Dymatic Chemicals. It trades about 0.07 of its potential returns per unit of risk. Dymatic Chemicals is currently generating about 0.05 per unit of risk. If you would invest 271.00 in Long Yuan Construction on October 17, 2024 and sell it today you would earn a total of 78.00 from holding Long Yuan Construction or generate 28.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Long Yuan Construction vs. Dymatic Chemicals
Performance |
| Timeline |
| Long Yuan Construction |
| Dymatic Chemicals |
Long Yuan and Dymatic Chemicals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Long Yuan and Dymatic Chemicals
The main advantage of trading using opposite Long Yuan and Dymatic Chemicals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Long Yuan position performs unexpectedly, Dymatic Chemicals 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 Dymatic Chemicals will offset losses from the drop in Dymatic Chemicals' long position.| Long Yuan vs. Jinhe Biotechnology Co | Long Yuan vs. Hengkang Medical Group | Long Yuan vs. Maccura Biotechnology Co | Long Yuan vs. Liaoning Chengda Biotechnology |
| Dymatic Chemicals vs. Long Yuan Construction | Dymatic Chemicals vs. Ping An Insurance | Dymatic Chemicals vs. Jiugui Liquor Co | Dymatic Chemicals vs. Xizi Clean Energy |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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