Correlation Between Keda Clean and Eastern Communications
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By analyzing existing cross correlation between Keda Clean Energy and Eastern Communications Co, you can compare the effects of market volatilities on Keda Clean and Eastern Communications 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 Keda Clean with a short position of Eastern Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keda Clean and Eastern Communications.
Diversification Opportunities for Keda Clean and Eastern Communications
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Keda and Eastern is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Keda Clean Energy and Eastern Communications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Eastern Communications and Keda Clean 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 Keda Clean Energy are associated (or correlated) with Eastern Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Eastern Communications has no effect on the direction of Keda Clean i.e., Keda Clean and Eastern Communications go up and down completely randomly.
Pair Corralation between Keda Clean and Eastern Communications
Assuming the 90 days trading horizon Keda Clean is expected to generate 1.46 times less return on investment than Eastern Communications. But when comparing it to its historical volatility, Keda Clean Energy is 1.25 times less risky than Eastern Communications. It trades about 0.05 of its potential returns per unit of risk. Eastern Communications Co is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 42.00 in Eastern Communications Co on September 1, 2024 and sell it today you would earn a total of 1.00 from holding Eastern Communications Co or generate 2.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Keda Clean Energy vs. Eastern Communications Co
Performance |
| Timeline |
| Keda Clean Energy |
| Eastern Communications |
Keda Clean and Eastern Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Keda Clean and Eastern Communications
The main advantage of trading using opposite Keda Clean and Eastern Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keda Clean position performs unexpectedly, Eastern Communications 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 Eastern Communications will offset losses from the drop in Eastern Communications' long position.| Keda Clean vs. Tianjin Pengling Rubber | Keda Clean vs. Hangzhou Gaoxin Rubber | Keda Clean vs. Caihong Display Devices | Keda Clean vs. Suzhou Xingye Material |
| Eastern Communications vs. Wuxi Chemical Equipment | Eastern Communications vs. Yangmei Chemical Co | Eastern Communications vs. Lander Sports Development | Eastern Communications vs. Jiangsu Jinling Sports |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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