Correlation Between Changchun Engley and Shandong Rike
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By analyzing existing cross correlation between Changchun Engley Automobile and Shandong Rike Chemical, you can compare the effects of market volatilities on Changchun Engley and Shandong Rike 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 Engley with a short position of Shandong Rike. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun Engley and Shandong Rike.
Diversification Opportunities for Changchun Engley and Shandong Rike
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Changchun and Shandong is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Changchun Engley Automobile and Shandong Rike Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Rike Chemical and Changchun Engley 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 Engley Automobile are associated (or correlated) with Shandong Rike. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Rike Chemical has no effect on the direction of Changchun Engley i.e., Changchun Engley and Shandong Rike go up and down completely randomly.
Pair Corralation between Changchun Engley and Shandong Rike
Assuming the 90 days trading horizon Changchun Engley Automobile is expected to under-perform the Shandong Rike. In addition to that, Changchun Engley is 1.07 times more volatile than Shandong Rike Chemical. It trades about -0.02 of its total potential returns per unit of risk. Shandong Rike Chemical is currently generating about 0.01 per unit of volatility. If you would invest 665.00 in Shandong Rike Chemical on October 11, 2024 and sell it today you would lose (54.00) from holding Shandong Rike Chemical or give up 8.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun Engley Automobile vs. Shandong Rike Chemical
Performance |
| Timeline |
| Changchun Engley Aut |
| Shandong Rike Chemical |
Changchun Engley and Shandong Rike Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun Engley and Shandong Rike
The main advantage of trading using opposite Changchun Engley and Shandong Rike positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun Engley position performs unexpectedly, Shandong Rike 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 Shandong Rike will offset losses from the drop in Shandong Rike's long position.| Changchun Engley vs. Nantong Haixing Electronics | Changchun Engley vs. Miracll Chemicals Co | Changchun Engley vs. Shijiazhuang Tonhe Electronics | Changchun Engley vs. Dymatic Chemicals |
| Shandong Rike vs. Great Sun Foods Co | Shandong Rike vs. XinJiang GuoTong Pipeline | Shandong Rike vs. Zhejiang Kingland Pipeline | Shandong Rike vs. Changchun Engley Automobile |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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