Correlation Between China Satellite and Chengdu Kanghua
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By analyzing existing cross correlation between China Satellite Communications and Chengdu Kanghua Biological, you can compare the effects of market volatilities on China Satellite and Chengdu Kanghua 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 Chengdu Kanghua. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Satellite and Chengdu Kanghua.
Diversification Opportunities for China Satellite and Chengdu Kanghua
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between China and Chengdu is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding China Satellite Communications and Chengdu Kanghua Biological in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chengdu Kanghua Biol 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 Chengdu Kanghua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chengdu Kanghua Biol has no effect on the direction of China Satellite i.e., China Satellite and Chengdu Kanghua go up and down completely randomly.
Pair Corralation between China Satellite and Chengdu Kanghua
Assuming the 90 days trading horizon China Satellite Communications is expected to generate 2.3 times more return on investment than Chengdu Kanghua. However, China Satellite is 2.3 times more volatile than Chengdu Kanghua Biological. It trades about 0.25 of its potential returns per unit of risk. Chengdu Kanghua Biological is currently generating about -0.06 per unit of risk. If you would invest 1,700 in China Satellite Communications on September 1, 2024 and sell it today you would earn a total of 617.00 from holding China Satellite Communications or generate 36.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Satellite Communications vs. Chengdu Kanghua Biological
Performance |
| Timeline |
| China Satellite Comm |
| Chengdu Kanghua Biol |
China Satellite and Chengdu Kanghua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Satellite and Chengdu Kanghua
The main advantage of trading using opposite China Satellite and Chengdu Kanghua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Satellite position performs unexpectedly, Chengdu Kanghua 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 Chengdu Kanghua will offset losses from the drop in Chengdu Kanghua's long position.| China Satellite vs. Qingdao Choho Industrial | China Satellite vs. Ye Chiu Metal | China Satellite vs. Shenzhen Kexin Communication | China Satellite vs. Haima Automobile Group |
| Chengdu Kanghua vs. Innovative Medical Management | Chengdu Kanghua vs. Tongyu Communication | Chengdu Kanghua vs. AVIC Fund Management | Chengdu Kanghua vs. Guangdong Shenglu Telecommunication |
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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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