Correlation Between Shaanxi Construction and Senci Electric
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By analyzing existing cross correlation between Shaanxi Construction Machinery and Senci Electric Machinery, you can compare the effects of market volatilities on Shaanxi Construction and Senci Electric 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 Senci Electric. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shaanxi Construction and Senci Electric.
Diversification Opportunities for Shaanxi Construction and Senci Electric
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shaanxi and Senci is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Shaanxi Construction Machinery and Senci Electric Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Senci Electric Machinery 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 Senci Electric. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Senci Electric Machinery has no effect on the direction of Shaanxi Construction i.e., Shaanxi Construction and Senci Electric go up and down completely randomly.
Pair Corralation between Shaanxi Construction and Senci Electric
Assuming the 90 days trading horizon Shaanxi Construction is expected to generate 6.41 times less return on investment than Senci Electric. In addition to that, Shaanxi Construction is 2.09 times more volatile than Senci Electric Machinery. It trades about 0.03 of its total potential returns per unit of risk. Senci Electric Machinery is currently generating about 0.35 per unit of volatility. If you would invest 1,493 in Senci Electric Machinery on September 27, 2024 and sell it today you would earn a total of 240.00 from holding Senci Electric Machinery or generate 16.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shaanxi Construction Machinery vs. Senci Electric Machinery
Performance |
| Timeline |
| Shaanxi Construction |
| Senci Electric Machinery |
Shaanxi Construction and Senci Electric Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shaanxi Construction and Senci Electric
The main advantage of trading using opposite Shaanxi Construction and Senci Electric positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shaanxi Construction position performs unexpectedly, Senci Electric 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 Senci Electric will offset losses from the drop in Senci Electric's long position.| Shaanxi Construction vs. Cambricon Technologies Corp | Shaanxi Construction vs. Loongson Technology Corp | Shaanxi Construction vs. Shenzhen Fortune Trend | Shaanxi Construction vs. Chongqing Road Bridge |
| Senci Electric vs. Industrial and Commercial | Senci Electric vs. Agricultural Bank of | Senci Electric vs. China Construction Bank | Senci Electric vs. Bank of China |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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