Correlation Between Longjian Road and Songcheng Performance
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By analyzing existing cross correlation between Longjian Road Bridge and Songcheng Performance Develop, you can compare the effects of market volatilities on Longjian Road and Songcheng Performance 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 Longjian Road with a short position of Songcheng Performance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Longjian Road and Songcheng Performance.
Diversification Opportunities for Longjian Road and Songcheng Performance
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Longjian and Songcheng is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Longjian Road Bridge and Songcheng Performance Develop in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Songcheng Performance and Longjian Road 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 Longjian Road Bridge are associated (or correlated) with Songcheng Performance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Songcheng Performance has no effect on the direction of Longjian Road i.e., Longjian Road and Songcheng Performance go up and down completely randomly.
Pair Corralation between Longjian Road and Songcheng Performance
Assuming the 90 days trading horizon Longjian Road Bridge is expected to generate 0.9 times more return on investment than Songcheng Performance. However, Longjian Road Bridge is 1.11 times less risky than Songcheng Performance. It trades about 0.09 of its potential returns per unit of risk. Songcheng Performance Develop is currently generating about -0.04 per unit of risk. If you would invest 382.00 in Longjian Road Bridge on September 1, 2024 and sell it today you would earn a total of 13.00 from holding Longjian Road Bridge or generate 3.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Longjian Road Bridge vs. Songcheng Performance Develop
Performance |
| Timeline |
| Longjian Road Bridge |
| Songcheng Performance |
Longjian Road and Songcheng Performance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Longjian Road and Songcheng Performance
The main advantage of trading using opposite Longjian Road and Songcheng Performance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Longjian Road position performs unexpectedly, Songcheng Performance 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 Songcheng Performance will offset losses from the drop in Songcheng Performance's long position.| Longjian Road vs. 159681 | Longjian Road vs. 159005 | Longjian Road vs. Loctek Ergonomic Technology | Longjian Road vs. 516220 |
| Songcheng Performance vs. Road Environment Technology | Songcheng Performance vs. Guangdong Jingyi Metal | Songcheng Performance vs. Jiangsu Broadcasting Cable | Songcheng Performance vs. Longjian Road Bridge |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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