Correlation Between Caihong Display and Techshine Electronics
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By analyzing existing cross correlation between Caihong Display Devices and Techshine Electronics Co, you can compare the effects of market volatilities on Caihong Display and Techshine Electronics 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 Caihong Display with a short position of Techshine Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Caihong Display and Techshine Electronics.
Diversification Opportunities for Caihong Display and Techshine Electronics
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Caihong and Techshine is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Caihong Display Devices and Techshine Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Techshine Electronics and Caihong Display 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 Caihong Display Devices are associated (or correlated) with Techshine Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Techshine Electronics has no effect on the direction of Caihong Display i.e., Caihong Display and Techshine Electronics go up and down completely randomly.
Pair Corralation between Caihong Display and Techshine Electronics
Assuming the 90 days trading horizon Caihong Display Devices is expected to generate 1.0 times more return on investment than Techshine Electronics. However, Caihong Display Devices is 1.0 times less risky than Techshine Electronics. It trades about -0.13 of its potential returns per unit of risk. Techshine Electronics Co is currently generating about -0.14 per unit of risk. If you would invest 789.00 in Caihong Display Devices on September 12, 2024 and sell it today you would lose (53.00) from holding Caihong Display Devices or give up 6.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Caihong Display Devices vs. Techshine Electronics Co
Performance |
| Timeline |
| Caihong Display Devices |
| Techshine Electronics |
Caihong Display and Techshine Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Caihong Display and Techshine Electronics
The main advantage of trading using opposite Caihong Display and Techshine Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Caihong Display position performs unexpectedly, Techshine Electronics 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 Techshine Electronics will offset losses from the drop in Techshine Electronics' long position.| Caihong Display vs. Gansu Jiu Steel | Caihong Display vs. Shandong Mining Machinery | Caihong Display vs. Aba Chemicals Corp | Caihong Display vs. BlueFocus Communication Group |
| Techshine Electronics vs. Caihong Display Devices | Techshine Electronics vs. Chengdu Spaceon Electronics | Techshine Electronics vs. Chengtun Mining Group | Techshine Electronics vs. Shanghai Yaoji Playing |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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