Correlation Between StarPower Semiconductor and China Express
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By analyzing existing cross correlation between StarPower Semiconductor and China Express Airlines, you can compare the effects of market volatilities on StarPower Semiconductor and China Express 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 StarPower Semiconductor with a short position of China Express. Check out your portfolio center. Please also check ongoing floating volatility patterns of StarPower Semiconductor and China Express.
Diversification Opportunities for StarPower Semiconductor and China Express
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between StarPower and China is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding StarPower Semiconductor and China Express Airlines in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Express Airlines and StarPower Semiconductor 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 StarPower Semiconductor are associated (or correlated) with China Express. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Express Airlines has no effect on the direction of StarPower Semiconductor i.e., StarPower Semiconductor and China Express go up and down completely randomly.
Pair Corralation between StarPower Semiconductor and China Express
Assuming the 90 days trading horizon StarPower Semiconductor is expected to under-perform the China Express. In addition to that, StarPower Semiconductor is 1.24 times more volatile than China Express Airlines. It trades about -0.06 of its total potential returns per unit of risk. China Express Airlines is currently generating about -0.02 per unit of volatility. If you would invest 1,270 in China Express Airlines on August 24, 2024 and sell it today you would lose (427.00) from holding China Express Airlines or give up 33.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
StarPower Semiconductor vs. China Express Airlines
Performance |
| Timeline |
| StarPower Semiconductor |
| China Express Airlines |
StarPower Semiconductor and China Express Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with StarPower Semiconductor and China Express
The main advantage of trading using opposite StarPower Semiconductor and China Express positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if StarPower Semiconductor position performs unexpectedly, China Express 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 China Express will offset losses from the drop in China Express' long position.The idea behind StarPower Semiconductor and China Express Airlines pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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