Correlation Between China Satellite and Central Plains
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By analyzing existing cross correlation between China Satellite Communications and Central Plains Environment, you can compare the effects of market volatilities on China Satellite and Central Plains 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 China Satellite with a short position of Central Plains. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Satellite and Central Plains.
Diversification Opportunities for China Satellite and Central Plains
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Central is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding China Satellite Communications and Central Plains Environment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Central Plains Envir and China Satellite 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 China Satellite Communications are associated (or correlated) with Central Plains. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Central Plains Envir has no effect on the direction of China Satellite i.e., China Satellite and Central Plains go up and down completely randomly.
Pair Corralation between China Satellite and Central Plains
Assuming the 90 days trading horizon China Satellite Communications is expected to generate 1.64 times more return on investment than Central Plains. However, China Satellite is 1.64 times more volatile than Central Plains Environment. It trades about 0.06 of its potential returns per unit of risk. Central Plains Environment is currently generating about 0.04 per unit of risk. If you would invest 1,196 in China Satellite Communications on September 4, 2024 and sell it today you would earn a total of 1,050 from holding China Satellite Communications or generate 87.79% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
China Satellite Communications vs. Central Plains Environment
Performance |
Timeline |
China Satellite Comm |
Central Plains Envir |
China Satellite and Central Plains Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with China Satellite and Central Plains
The main advantage of trading using opposite China Satellite and Central Plains positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Satellite position performs unexpectedly, Central Plains 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 Central Plains will offset losses from the drop in Central Plains' long position.China Satellite vs. New China Life | China Satellite vs. Ming Yang Smart | China Satellite vs. 159681 | China Satellite vs. 159005 |
Central Plains vs. Juewei Food Co | Central Plains vs. China Satellite Communications | Central Plains vs. Anji Foodstuff Co | Central Plains vs. Jiajia Food Group |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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