Correlation Between Youyou Foods and SUNSEA Telecommunicatio
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By analyzing existing cross correlation between Youyou Foods Co and SUNSEA Telecommunications Co, you can compare the effects of market volatilities on Youyou Foods and SUNSEA Telecommunicatio 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 Youyou Foods with a short position of SUNSEA Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youyou Foods and SUNSEA Telecommunicatio.
Diversification Opportunities for Youyou Foods and SUNSEA Telecommunicatio
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Youyou and SUNSEA is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Youyou Foods Co and SUNSEA Telecommunications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on SUNSEA Telecommunicatio and Youyou Foods 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 Youyou Foods Co are associated (or correlated) with SUNSEA Telecommunicatio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of SUNSEA Telecommunicatio has no effect on the direction of Youyou Foods i.e., Youyou Foods and SUNSEA Telecommunicatio go up and down completely randomly.
Pair Corralation between Youyou Foods and SUNSEA Telecommunicatio
Assuming the 90 days trading horizon Youyou Foods Co is expected to generate 1.44 times more return on investment than SUNSEA Telecommunicatio. However, Youyou Foods is 1.44 times more volatile than SUNSEA Telecommunications Co. It trades about 0.28 of its potential returns per unit of risk. SUNSEA Telecommunications Co is currently generating about -0.16 per unit of risk. If you would invest 735.00 in Youyou Foods Co on August 27, 2024 and sell it today you would earn a total of 232.00 from holding Youyou Foods Co or generate 31.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Youyou Foods Co vs. SUNSEA Telecommunications Co
Performance |
| Timeline |
| Youyou Foods |
| SUNSEA Telecommunicatio |
Youyou Foods and SUNSEA Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Youyou Foods and SUNSEA Telecommunicatio
The main advantage of trading using opposite Youyou Foods and SUNSEA Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youyou Foods position performs unexpectedly, SUNSEA Telecommunicatio 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 SUNSEA Telecommunicatio will offset losses from the drop in SUNSEA Telecommunicatio's long position.| Youyou Foods vs. China Petroleum Chemical | Youyou Foods vs. PetroChina Co Ltd | Youyou Foods vs. China State Construction | Youyou Foods vs. China Railway 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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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