Correlation Between Shaanxi Construction and Shaanxi Broadcast
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By analyzing existing cross correlation between Shaanxi Construction Machinery and Shaanxi Broadcast TV, you can compare the effects of market volatilities on Shaanxi Construction and Shaanxi Broadcast 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 Shaanxi Construction with a short position of Shaanxi Broadcast. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shaanxi Construction and Shaanxi Broadcast.
Diversification Opportunities for Shaanxi Construction and Shaanxi Broadcast
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shaanxi and Shaanxi is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Shaanxi Construction Machinery and Shaanxi Broadcast TV in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shaanxi Broadcast and Shaanxi Construction 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 Shaanxi Construction Machinery are associated (or correlated) with Shaanxi Broadcast. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shaanxi Broadcast has no effect on the direction of Shaanxi Construction i.e., Shaanxi Construction and Shaanxi Broadcast go up and down completely randomly.
Pair Corralation between Shaanxi Construction and Shaanxi Broadcast
Assuming the 90 days trading horizon Shaanxi Construction Machinery is expected to generate 1.5 times more return on investment than Shaanxi Broadcast. However, Shaanxi Construction is 1.5 times more volatile than Shaanxi Broadcast TV. It trades about -0.11 of its potential returns per unit of risk. Shaanxi Broadcast TV is currently generating about -0.34 per unit of risk. If you would invest 355.00 in Shaanxi Construction Machinery on October 11, 2024 and sell it today you would lose (40.00) from holding Shaanxi Construction Machinery or give up 11.27% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Shaanxi Construction Machinery vs. Shaanxi Broadcast TV
Performance |
Timeline |
Shaanxi Construction |
Shaanxi Broadcast |
Shaanxi Construction and Shaanxi Broadcast Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Shaanxi Construction and Shaanxi Broadcast
The main advantage of trading using opposite Shaanxi Construction and Shaanxi Broadcast positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shaanxi Construction position performs unexpectedly, Shaanxi Broadcast 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 Shaanxi Broadcast will offset losses from the drop in Shaanxi Broadcast's long position.Shaanxi Construction vs. Shanghai CEO Environmental | Shaanxi Construction vs. China Asset Management | Shaanxi Construction vs. Sharetronic Data Technology | Shaanxi Construction vs. ButOne Information Corp |
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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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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