Correlation Between UE Furniture and Shantui Construction
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By analyzing existing cross correlation between UE Furniture Co and Shantui Construction Machinery, you can compare the effects of market volatilities on UE Furniture and Shantui Construction 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 UE Furniture with a short position of Shantui Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of UE Furniture and Shantui Construction.
Diversification Opportunities for UE Furniture and Shantui Construction
0.08 | Correlation Coefficient |
Significant diversification
The 3 months correlation between 603600 and Shantui is 0.08. Overlapping area represents the amount of risk that can be diversified away by holding UE Furniture Co and Shantui Construction Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shantui Construction and UE Furniture 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 UE Furniture Co are associated (or correlated) with Shantui Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shantui Construction has no effect on the direction of UE Furniture i.e., UE Furniture and Shantui Construction go up and down completely randomly.
Pair Corralation between UE Furniture and Shantui Construction
Assuming the 90 days trading horizon UE Furniture Co is expected to generate 0.58 times more return on investment than Shantui Construction. However, UE Furniture Co is 1.71 times less risky than Shantui Construction. It trades about -0.06 of its potential returns per unit of risk. Shantui Construction Machinery is currently generating about -0.05 per unit of risk. If you would invest 1,209 in UE Furniture Co on November 29, 2024 and sell it today you would lose (23.00) from holding UE Furniture Co or give up 1.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 94.12% |
| Values | Daily Returns |
UE Furniture Co vs. Shantui Construction Machinery
Performance |
| Timeline |
| UE Furniture |
| Shantui Construction |
UE Furniture and Shantui Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UE Furniture and Shantui Construction
The main advantage of trading using opposite UE Furniture and Shantui Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UE Furniture position performs unexpectedly, Shantui Construction 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 Shantui Construction will offset losses from the drop in Shantui Construction's long position.| UE Furniture vs. NBTM New Materials | UE Furniture vs. Anhui Deli Household | UE Furniture vs. iSoftStone Information Technology | UE Furniture vs. Biwin Storage Technology |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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