Correlation Between Mengtian Home and Suzhou Mingzhi
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By analyzing existing cross correlation between Mengtian Home Group and Suzhou Mingzhi Technology, you can compare the effects of market volatilities on Mengtian Home and Suzhou Mingzhi 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 Suzhou Mingzhi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Mengtian Home and Suzhou Mingzhi.
Diversification Opportunities for Mengtian Home and Suzhou Mingzhi
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Mengtian and Suzhou is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Mengtian Home Group and Suzhou Mingzhi Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suzhou Mingzhi Technology 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 Suzhou Mingzhi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suzhou Mingzhi Technology has no effect on the direction of Mengtian Home i.e., Mengtian Home and Suzhou Mingzhi go up and down completely randomly.
Pair Corralation between Mengtian Home and Suzhou Mingzhi
Assuming the 90 days trading horizon Mengtian Home Group is expected to under-perform the Suzhou Mingzhi. But the stock apears to be less risky and, when comparing its historical volatility, Mengtian Home Group is 1.25 times less risky than Suzhou Mingzhi. The stock trades about -0.02 of its potential returns per unit of risk. The Suzhou Mingzhi Technology is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 1,924 in Suzhou Mingzhi Technology on August 25, 2024 and sell it today you would lose (119.00) from holding Suzhou Mingzhi Technology or give up 6.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Mengtian Home Group vs. Suzhou Mingzhi Technology
Performance |
| Timeline |
| Mengtian Home Group |
| Suzhou Mingzhi Technology |
Mengtian Home and Suzhou Mingzhi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Mengtian Home and Suzhou Mingzhi
The main advantage of trading using opposite Mengtian Home and Suzhou Mingzhi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Mengtian Home position performs unexpectedly, Suzhou Mingzhi 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 Suzhou Mingzhi will offset losses from the drop in Suzhou Mingzhi's long position.| Mengtian Home vs. China Petroleum Chemical | Mengtian Home vs. PetroChina Co Ltd | Mengtian Home vs. China State Construction | Mengtian Home vs. China Railway Group |
| Suzhou Mingzhi vs. Agricultural Bank of | Suzhou Mingzhi vs. Industrial and Commercial | Suzhou Mingzhi vs. Bank of China | Suzhou Mingzhi 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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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