Correlation Between China International and Techshine Electronics
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By analyzing existing cross correlation between China International Capital and Techshine Electronics Co, you can compare the effects of market volatilities on China International and Techshine Electronics 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 International with a short position of Techshine Electronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of China International and Techshine Electronics.
Diversification Opportunities for China International and Techshine Electronics
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Techshine is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding China International Capital and Techshine Electronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Techshine Electronics and China International 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 International Capital are associated (or correlated) with Techshine Electronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Techshine Electronics has no effect on the direction of China International i.e., China International and Techshine Electronics go up and down completely randomly.
Pair Corralation between China International and Techshine Electronics
Assuming the 90 days trading horizon China International Capital is expected to under-perform the Techshine Electronics. But the stock apears to be less risky and, when comparing its historical volatility, China International Capital is 1.04 times less risky than Techshine Electronics. The stock trades about -0.08 of its potential returns per unit of risk. The Techshine Electronics Co is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 2,015 in Techshine Electronics Co on August 29, 2024 and sell it today you would lose (26.00) from holding Techshine Electronics Co or give up 1.29% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China International Capital vs. Techshine Electronics Co
Performance |
| Timeline |
| China International |
| Techshine Electronics |
China International and Techshine Electronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China International and Techshine Electronics
The main advantage of trading using opposite China International and Techshine Electronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China International position performs unexpectedly, Techshine Electronics 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 Techshine Electronics will offset losses from the drop in Techshine Electronics' long position.| China International vs. Youyou Foods Co | China International vs. Sinomach General Machinery | China International vs. Shanghai Ziyan Foods | China International vs. Sichuan Teway Food |
| Techshine Electronics vs. China State Construction | Techshine Electronics vs. Huafa Industrial Co | Techshine Electronics vs. China International Capital | Techshine Electronics vs. Kweichow Moutai Co |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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