Correlation Between Bomin Electronics and Liaoning Chengda
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By analyzing existing cross correlation between Bomin Electronics Co and Liaoning Chengda Biotechnology, you can compare the effects of market volatilities on Bomin Electronics and Liaoning Chengda 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 Bomin Electronics with a short position of Liaoning Chengda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bomin Electronics and Liaoning Chengda.
Diversification Opportunities for Bomin Electronics and Liaoning Chengda
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Bomin and Liaoning is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Bomin Electronics Co and Liaoning Chengda Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Liaoning Chengda Bio and Bomin Electronics 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 Bomin Electronics Co are associated (or correlated) with Liaoning Chengda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Liaoning Chengda Bio has no effect on the direction of Bomin Electronics i.e., Bomin Electronics and Liaoning Chengda go up and down completely randomly.
Pair Corralation between Bomin Electronics and Liaoning Chengda
Assuming the 90 days trading horizon Bomin Electronics Co is expected to generate 1.82 times more return on investment than Liaoning Chengda. However, Bomin Electronics is 1.82 times more volatile than Liaoning Chengda Biotechnology. It trades about 0.0 of its potential returns per unit of risk. Liaoning Chengda Biotechnology is currently generating about -0.01 per unit of risk. If you would invest 1,065 in Bomin Electronics Co on September 12, 2024 and sell it today you would lose (183.00) from holding Bomin Electronics Co or give up 17.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bomin Electronics Co vs. Liaoning Chengda Biotechnology
Performance |
| Timeline |
| Bomin Electronics |
| Liaoning Chengda Bio |
Bomin Electronics and Liaoning Chengda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bomin Electronics and Liaoning Chengda
The main advantage of trading using opposite Bomin Electronics and Liaoning Chengda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bomin Electronics position performs unexpectedly, Liaoning Chengda 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 Liaoning Chengda will offset losses from the drop in Liaoning Chengda's long position.| Bomin Electronics vs. Gansu Jiu Steel | Bomin Electronics vs. Shandong Mining Machinery | Bomin Electronics vs. Aba Chemicals Corp | Bomin Electronics vs. BlueFocus Communication Group |
| Liaoning Chengda vs. Cultural Investment Holdings | Liaoning Chengda vs. Gome Telecom Equipment | Liaoning Chengda vs. Holitech Technology Co | Liaoning Chengda vs. Zotye Automobile 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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