Correlation Between Dawning Information and Long Yuan
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By analyzing existing cross correlation between Dawning Information Industry and Long Yuan Construction, you can compare the effects of market volatilities on Dawning Information and Long Yuan 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 Dawning Information with a short position of Long Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dawning Information and Long Yuan.
Diversification Opportunities for Dawning Information and Long Yuan
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dawning and Long is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Dawning Information Industry and Long Yuan Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Long Yuan Construction and Dawning Information 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 Dawning Information Industry are associated (or correlated) with Long Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Long Yuan Construction has no effect on the direction of Dawning Information i.e., Dawning Information and Long Yuan go up and down completely randomly.
Pair Corralation between Dawning Information and Long Yuan
Assuming the 90 days trading horizon Dawning Information Industry is expected to generate 1.1 times more return on investment than Long Yuan. However, Dawning Information is 1.1 times more volatile than Long Yuan Construction. It trades about -0.21 of its potential returns per unit of risk. Long Yuan Construction is currently generating about -0.27 per unit of risk. If you would invest 7,499 in Dawning Information Industry on October 10, 2024 and sell it today you would lose (955.00) from holding Dawning Information Industry or give up 12.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dawning Information Industry vs. Long Yuan Construction
Performance |
| Timeline |
| Dawning Information |
| Long Yuan Construction |
Dawning Information and Long Yuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dawning Information and Long Yuan
The main advantage of trading using opposite Dawning Information and Long Yuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dawning Information position performs unexpectedly, Long Yuan 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 Long Yuan will offset losses from the drop in Long Yuan's long position.| Dawning Information vs. Nanxing Furniture Machinery | Dawning Information vs. Grandblue Environment Co | Dawning Information vs. Wangneng Environment Co | Dawning Information vs. Oppein Home Group |
| Long Yuan vs. Agricultural Bank of | Long Yuan vs. Industrial and Commercial | Long Yuan vs. Bank of China | Long Yuan vs. PetroChina Co Ltd |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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