Correlation Between HeBei Jinniu and SUNSEA Telecommunicatio
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By analyzing existing cross correlation between HeBei Jinniu Chemical and SUNSEA Telecommunications Co, you can compare the effects of market volatilities on HeBei Jinniu and SUNSEA Telecommunicatio 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 HeBei Jinniu with a short position of SUNSEA Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of HeBei Jinniu and SUNSEA Telecommunicatio.
Diversification Opportunities for HeBei Jinniu and SUNSEA Telecommunicatio
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between HeBei and SUNSEA is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding HeBei Jinniu Chemical and SUNSEA Telecommunications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUNSEA Telecommunicatio and HeBei Jinniu 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 HeBei Jinniu Chemical are associated (or correlated) with SUNSEA Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SUNSEA Telecommunicatio has no effect on the direction of HeBei Jinniu i.e., HeBei Jinniu and SUNSEA Telecommunicatio go up and down completely randomly.
Pair Corralation between HeBei Jinniu and SUNSEA Telecommunicatio
Assuming the 90 days trading horizon HeBei Jinniu Chemical is expected to generate 0.59 times more return on investment than SUNSEA Telecommunicatio. However, HeBei Jinniu Chemical is 1.7 times less risky than SUNSEA Telecommunicatio. It trades about 0.03 of its potential returns per unit of risk. SUNSEA Telecommunications Co is currently generating about -0.15 per unit of risk. If you would invest 560.00 in HeBei Jinniu Chemical on October 16, 2024 and sell it today you would earn a total of 5.00 from holding HeBei Jinniu Chemical or generate 0.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
HeBei Jinniu Chemical vs. SUNSEA Telecommunications Co
Performance |
| Timeline |
| HeBei Jinniu Chemical |
| SUNSEA Telecommunicatio |
HeBei Jinniu and SUNSEA Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HeBei Jinniu and SUNSEA Telecommunicatio
The main advantage of trading using opposite HeBei Jinniu and SUNSEA Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HeBei Jinniu position performs unexpectedly, SUNSEA Telecommunicatio 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 SUNSEA Telecommunicatio will offset losses from the drop in SUNSEA Telecommunicatio's long position.| HeBei Jinniu vs. Liaoning Dingjide Petrochemical | HeBei Jinniu vs. Yuanjie Semiconductor Technology | HeBei Jinniu vs. Guangzhou Jointas Chemical | HeBei Jinniu vs. Shenyang Chemical Industry |
| SUNSEA Telecommunicatio vs. China Sports Industry | SUNSEA Telecommunicatio vs. HeBei Jinniu Chemical | SUNSEA Telecommunicatio vs. Shuhua Sports Co | SUNSEA Telecommunicatio vs. Shandong Rike Chemical |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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