Correlation Between UE Furniture and Yangmei Chemical
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By analyzing existing cross correlation between UE Furniture Co and Yangmei Chemical Co, you can compare the effects of market volatilities on UE Furniture and Yangmei Chemical 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 Yangmei Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of UE Furniture and Yangmei Chemical.
Diversification Opportunities for UE Furniture and Yangmei Chemical
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between 603600 and Yangmei is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding UE Furniture Co and Yangmei Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yangmei Chemical 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 Yangmei Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yangmei Chemical has no effect on the direction of UE Furniture i.e., UE Furniture and Yangmei Chemical go up and down completely randomly.
Pair Corralation between UE Furniture and Yangmei Chemical
Assuming the 90 days trading horizon UE Furniture Co is expected to generate 1.61 times more return on investment than Yangmei Chemical. However, UE Furniture is 1.61 times more volatile than Yangmei Chemical Co. It trades about 0.18 of its potential returns per unit of risk. Yangmei Chemical Co is currently generating about -0.11 per unit of risk. If you would invest 1,148 in UE Furniture Co on October 22, 2024 and sell it today you would earn a total of 140.00 from holding UE Furniture Co or generate 12.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
UE Furniture Co vs. Yangmei Chemical Co
Performance |
| Timeline |
| UE Furniture |
| Yangmei Chemical |
UE Furniture and Yangmei Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with UE Furniture and Yangmei Chemical
The main advantage of trading using opposite UE Furniture and Yangmei Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if UE Furniture position performs unexpectedly, Yangmei Chemical 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 Yangmei Chemical will offset losses from the drop in Yangmei Chemical's long position.| UE Furniture vs. Guangxi Wuzhou Communications | UE Furniture vs. Iat Automobile Technology | UE Furniture vs. Fibocom Wireless | UE Furniture vs. Fiberhome Telecommunication Technologies |
| Yangmei Chemical vs. Mengtian Home Group | Yangmei Chemical vs. Ningbo MedicalSystem Biotechnology | Yangmei Chemical vs. Bloomage Biotechnology Corp | Yangmei Chemical vs. UE Furniture 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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