Correlation Between Mengtian Home and DO Home
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By analyzing existing cross correlation between Mengtian Home Group and DO Home Collection, you can compare the effects of market volatilities on Mengtian Home and DO Home 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 Mengtian Home with a short position of DO Home. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mengtian Home and DO Home.
Diversification Opportunities for Mengtian Home and DO Home
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mengtian and 002798 is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Mengtian Home Group and DO Home Collection in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DO Home Collection and Mengtian Home 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 Mengtian Home Group are associated (or correlated) with DO Home. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DO Home Collection has no effect on the direction of Mengtian Home i.e., Mengtian Home and DO Home go up and down completely randomly.
Pair Corralation between Mengtian Home and DO Home
Assuming the 90 days trading horizon Mengtian Home is expected to generate 1.17 times less return on investment than DO Home. But when comparing it to its historical volatility, Mengtian Home Group is 2.2 times less risky than DO Home. It trades about 0.18 of its potential returns per unit of risk. DO Home Collection is currently generating about 0.1 of returns per unit of risk over similar time horizon. If you would invest 419.00 in DO Home Collection on September 1, 2024 and sell it today you would earn a total of 25.00 from holding DO Home Collection or generate 5.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mengtian Home Group vs. DO Home Collection
Performance |
| Timeline |
| Mengtian Home Group |
| DO Home Collection |
Mengtian Home and DO Home Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mengtian Home and DO Home
The main advantage of trading using opposite Mengtian Home and DO Home positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mengtian Home position performs unexpectedly, DO Home 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 DO Home will offset losses from the drop in DO Home's long position.| Mengtian Home vs. China Publishing Media | Mengtian Home vs. Time Publishing and | Mengtian Home vs. Yingde Greatchem Chemicals | Mengtian Home vs. Focus Media Information |
| DO Home vs. Sinocat Environmental Technology | DO Home vs. Beijing SPC Environment | DO Home vs. Yankershop Food Co | DO Home vs. Anji Foodstuff 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 Global Correlations module to find global opportunities by holding instruments from different markets.
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