Correlation Between Suzhou Weizhixiang and Hangzhou Pinming
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By analyzing existing cross correlation between Suzhou Weizhixiang Food and Hangzhou Pinming Software, you can compare the effects of market volatilities on Suzhou Weizhixiang and Hangzhou Pinming 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 Suzhou Weizhixiang with a short position of Hangzhou Pinming. Check out your portfolio center. Please also check ongoing floating volatility patterns of Suzhou Weizhixiang and Hangzhou Pinming.
Diversification Opportunities for Suzhou Weizhixiang and Hangzhou Pinming
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Suzhou and Hangzhou is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Suzhou Weizhixiang Food and Hangzhou Pinming Software in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hangzhou Pinming Software and Suzhou Weizhixiang 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 Suzhou Weizhixiang Food are associated (or correlated) with Hangzhou Pinming. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hangzhou Pinming Software has no effect on the direction of Suzhou Weizhixiang i.e., Suzhou Weizhixiang and Hangzhou Pinming go up and down completely randomly.
Pair Corralation between Suzhou Weizhixiang and Hangzhou Pinming
Assuming the 90 days trading horizon Suzhou Weizhixiang Food is expected to under-perform the Hangzhou Pinming. But the stock apears to be less risky and, when comparing its historical volatility, Suzhou Weizhixiang Food is 1.29 times less risky than Hangzhou Pinming. The stock trades about -0.03 of its potential returns per unit of risk. The Hangzhou Pinming Software is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 2,934 in Hangzhou Pinming Software on August 25, 2024 and sell it today you would lose (142.00) from holding Hangzhou Pinming Software or give up 4.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Suzhou Weizhixiang Food vs. Hangzhou Pinming Software
Performance |
| Timeline |
| Suzhou Weizhixiang Food |
| Hangzhou Pinming Software |
Suzhou Weizhixiang and Hangzhou Pinming Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Suzhou Weizhixiang and Hangzhou Pinming
The main advantage of trading using opposite Suzhou Weizhixiang and Hangzhou Pinming positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Suzhou Weizhixiang position performs unexpectedly, Hangzhou Pinming 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 Hangzhou Pinming will offset losses from the drop in Hangzhou Pinming's long position.| Suzhou Weizhixiang vs. China Petroleum Chemical | Suzhou Weizhixiang vs. PetroChina Co Ltd | Suzhou Weizhixiang vs. China State Construction | Suzhou Weizhixiang vs. China Railway Group |
| Hangzhou Pinming vs. Shenzhen Kexin Communication | Hangzhou Pinming vs. Beijing Wandong Medical | Hangzhou Pinming vs. Blue Sail Medical | Hangzhou Pinming vs. Winner Medical 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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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