Correlation Between Industrial and Sanan Optoelectronics
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By analyzing existing cross correlation between Industrial and Commercial and Sanan Optoelectronics Co, you can compare the effects of market volatilities on Industrial and Sanan Optoelectronics 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 Industrial with a short position of Sanan Optoelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial and Sanan Optoelectronics.
Diversification Opportunities for Industrial and Sanan Optoelectronics
-0.75 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Industrial and Sanan is -0.75. Overlapping area represents the amount of risk that can be diversified away by holding Industrial and Commercial and Sanan Optoelectronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sanan Optoelectronics and Industrial 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 Industrial and Commercial are associated (or correlated) with Sanan Optoelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sanan Optoelectronics has no effect on the direction of Industrial i.e., Industrial and Sanan Optoelectronics go up and down completely randomly.
Pair Corralation between Industrial and Sanan Optoelectronics
Assuming the 90 days trading horizon Industrial and Commercial is expected to generate 0.63 times more return on investment than Sanan Optoelectronics. However, Industrial and Commercial is 1.58 times less risky than Sanan Optoelectronics. It trades about 0.07 of its potential returns per unit of risk. Sanan Optoelectronics Co is currently generating about -0.18 per unit of risk. If you would invest 649.00 in Industrial and Commercial on October 20, 2024 and sell it today you would earn a total of 12.00 from holding Industrial and Commercial or generate 1.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial and Commercial vs. Sanan Optoelectronics Co
Performance |
| Timeline |
| Industrial and Commercial |
| Sanan Optoelectronics |
Industrial and Sanan Optoelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial and Sanan Optoelectronics
The main advantage of trading using opposite Industrial and Sanan Optoelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial position performs unexpectedly, Sanan Optoelectronics 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 Sanan Optoelectronics will offset losses from the drop in Sanan Optoelectronics' long position.| Industrial vs. Shenzhen Silver Basis | Industrial vs. Dezhan HealthCare Co | Industrial vs. De Rucci Healthy | Industrial vs. Humanwell Healthcare Group |
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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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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