Correlation Between UE Furniture and Shenzhen Zhongzhuang
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By analyzing existing cross correlation between UE Furniture Co and Shenzhen Zhongzhuang Construction, you can compare the effects of market volatilities on UE Furniture and Shenzhen Zhongzhuang 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 Shenzhen Zhongzhuang. Check out your portfolio center. Please also check ongoing floating volatility patterns of UE Furniture and Shenzhen Zhongzhuang.
Diversification Opportunities for UE Furniture and Shenzhen Zhongzhuang
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between 603600 and Shenzhen is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding UE Furniture Co and Shenzhen Zhongzhuang Construct in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Zhongzhuang 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 Shenzhen Zhongzhuang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Zhongzhuang has no effect on the direction of UE Furniture i.e., UE Furniture and Shenzhen Zhongzhuang go up and down completely randomly.
Pair Corralation between UE Furniture and Shenzhen Zhongzhuang
Assuming the 90 days trading horizon UE Furniture is expected to generate 2.94 times less return on investment than Shenzhen Zhongzhuang. But when comparing it to its historical volatility, UE Furniture Co is 1.29 times less risky than Shenzhen Zhongzhuang. It trades about 0.11 of its potential returns per unit of risk. Shenzhen Zhongzhuang Construction is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 138.00 in Shenzhen Zhongzhuang Construction on October 18, 2024 and sell it today you would earn a total of 203.00 from holding Shenzhen Zhongzhuang Construction or generate 147.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
UE Furniture Co vs. Shenzhen Zhongzhuang Construct
Performance |
| Timeline |
| UE Furniture |
| Shenzhen Zhongzhuang |
UE Furniture and Shenzhen Zhongzhuang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UE Furniture and Shenzhen Zhongzhuang
The main advantage of trading using opposite UE Furniture and Shenzhen Zhongzhuang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UE Furniture position performs unexpectedly, Shenzhen Zhongzhuang 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 Shenzhen Zhongzhuang will offset losses from the drop in Shenzhen Zhongzhuang's long position.| UE Furniture vs. Jilin Chemical Fibre | UE Furniture vs. Guilin Seamild Foods | UE Furniture vs. New Hope Dairy | UE Furniture vs. Jiajia Food Group |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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