Correlation Between Yangmei Chemical and CICT Mobile
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By analyzing existing cross correlation between Yangmei Chemical Co and CICT Mobile Communication, you can compare the effects of market volatilities on Yangmei Chemical and CICT Mobile 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 Yangmei Chemical with a short position of CICT Mobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yangmei Chemical and CICT Mobile.
Diversification Opportunities for Yangmei Chemical and CICT Mobile
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Yangmei and CICT is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Yangmei Chemical Co and CICT Mobile Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CICT Mobile Communication and Yangmei Chemical 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 Yangmei Chemical Co are associated (or correlated) with CICT Mobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CICT Mobile Communication has no effect on the direction of Yangmei Chemical i.e., Yangmei Chemical and CICT Mobile go up and down completely randomly.
Pair Corralation between Yangmei Chemical and CICT Mobile
Assuming the 90 days trading horizon Yangmei Chemical Co is expected to generate 1.0 times more return on investment than CICT Mobile. However, Yangmei Chemical Co is 1.0 times less risky than CICT Mobile. It trades about 0.06 of its potential returns per unit of risk. CICT Mobile Communication is currently generating about 0.05 per unit of risk. If you would invest 234.00 in Yangmei Chemical Co on September 5, 2024 and sell it today you would earn a total of 7.00 from holding Yangmei Chemical Co or generate 2.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yangmei Chemical Co vs. CICT Mobile Communication
Performance |
| Timeline |
| Yangmei Chemical |
| CICT Mobile Communication |
Yangmei Chemical and CICT Mobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yangmei Chemical and CICT Mobile
The main advantage of trading using opposite Yangmei Chemical and CICT Mobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yangmei Chemical position performs unexpectedly, CICT Mobile 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 CICT Mobile will offset losses from the drop in CICT Mobile's long position.| Yangmei Chemical vs. Sichuan Jinshi Technology | Yangmei Chemical vs. FSPG Hi Tech Co | Yangmei Chemical vs. Wuhan Yangtze Communication | Yangmei Chemical vs. Fujian Newland Computer |
| CICT Mobile vs. Tianjin Silvery Dragon | CICT Mobile vs. Dymatic Chemicals | CICT Mobile vs. Yangmei Chemical Co | CICT Mobile vs. China Sports Industry |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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