Correlation Between Changchun Faway and Masterwork Machinery
Specify exactly 2 symbols:
By analyzing existing cross correlation between Changchun Faway Automobile and Masterwork Machinery, you can compare the effects of market volatilities on Changchun Faway and Masterwork Machinery 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 Changchun Faway with a short position of Masterwork Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun Faway and Masterwork Machinery.
Diversification Opportunities for Changchun Faway and Masterwork Machinery
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Changchun and Masterwork is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Changchun Faway Automobile and Masterwork Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Masterwork Machinery and Changchun Faway 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 Changchun Faway Automobile are associated (or correlated) with Masterwork Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Masterwork Machinery has no effect on the direction of Changchun Faway i.e., Changchun Faway and Masterwork Machinery go up and down completely randomly.
Pair Corralation between Changchun Faway and Masterwork Machinery
Assuming the 90 days trading horizon Changchun Faway Automobile is expected to under-perform the Masterwork Machinery. But the stock apears to be less risky and, when comparing its historical volatility, Changchun Faway Automobile is 2.36 times less risky than Masterwork Machinery. The stock trades about -0.01 of its potential returns per unit of risk. The Masterwork Machinery is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 563.00 in Masterwork Machinery on August 29, 2024 and sell it today you would earn a total of 46.00 from holding Masterwork Machinery or generate 8.17% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun Faway Automobile vs. Masterwork Machinery
Performance |
| Timeline |
| Changchun Faway Auto |
| Masterwork Machinery |
Changchun Faway and Masterwork Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun Faway and Masterwork Machinery
The main advantage of trading using opposite Changchun Faway and Masterwork Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun Faway position performs unexpectedly, Masterwork Machinery 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 Masterwork Machinery will offset losses from the drop in Masterwork Machinery's long position.| Changchun Faway vs. Miracll Chemicals Co | Changchun Faway vs. Guangzhou KingTeller Technology | Changchun Faway vs. Nantong Jiangshan Agrochemical | Changchun Faway vs. Shanghai Jinfeng Wine |
| Masterwork Machinery vs. Biwin Storage Technology | Masterwork Machinery vs. PetroChina Co Ltd | Masterwork Machinery vs. Industrial and Commercial | Masterwork Machinery vs. China Construction Bank |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Portfolio Dashboard Portfolio dashboard that provides centralized access to all your investments | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Technical Analysis Check basic technical indicators and analysis based on most latest market data | |
| Pair Correlation Compare performance and examine fundamental relationship between any two equity instruments |