Correlation Between Duzhe Publishing and Shenzhen
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By analyzing existing cross correlation between Duzhe Publishing Media and Shenzhen AV Display Co, you can compare the effects of market volatilities on Duzhe Publishing and Shenzhen 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 Duzhe Publishing with a short position of Shenzhen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Duzhe Publishing and Shenzhen.
Diversification Opportunities for Duzhe Publishing and Shenzhen
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Duzhe and Shenzhen is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Duzhe Publishing Media and Shenzhen AV Display Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen AV Display and Duzhe Publishing 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 Duzhe Publishing Media are associated (or correlated) with Shenzhen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen AV Display has no effect on the direction of Duzhe Publishing i.e., Duzhe Publishing and Shenzhen go up and down completely randomly.
Pair Corralation between Duzhe Publishing and Shenzhen
Assuming the 90 days trading horizon Duzhe Publishing Media is expected to generate 0.96 times more return on investment than Shenzhen. However, Duzhe Publishing Media is 1.05 times less risky than Shenzhen. It trades about 0.22 of its potential returns per unit of risk. Shenzhen AV Display Co is currently generating about 0.19 per unit of risk. If you would invest 566.00 in Duzhe Publishing Media on November 7, 2024 and sell it today you would earn a total of 45.00 from holding Duzhe Publishing Media or generate 7.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Duzhe Publishing Media vs. Shenzhen AV Display Co
Performance |
| Timeline |
| Duzhe Publishing Media |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
| Shenzhen AV Display |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Duzhe Publishing and Shenzhen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Duzhe Publishing and Shenzhen
The main advantage of trading using opposite Duzhe Publishing and Shenzhen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Duzhe Publishing position performs unexpectedly, Shenzhen 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 will offset losses from the drop in Shenzhen's long position.The idea behind Duzhe Publishing Media and Shenzhen AV Display Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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