Correlation Between Shuhua Sports and SUNSEA Telecommunicatio
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By analyzing existing cross correlation between Shuhua Sports Co and SUNSEA Telecommunications Co, you can compare the effects of market volatilities on Shuhua Sports 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 Shuhua Sports with a short position of SUNSEA Telecommunicatio. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shuhua Sports and SUNSEA Telecommunicatio.
Diversification Opportunities for Shuhua Sports and SUNSEA Telecommunicatio
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shuhua and SUNSEA is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Shuhua Sports 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 Shuhua Sports 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 Shuhua Sports 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 Shuhua Sports i.e., Shuhua Sports and SUNSEA Telecommunicatio go up and down completely randomly.
Pair Corralation between Shuhua Sports and SUNSEA Telecommunicatio
Assuming the 90 days trading horizon Shuhua Sports Co is expected to generate 0.64 times more return on investment than SUNSEA Telecommunicatio. However, Shuhua Sports Co is 1.56 times less risky than SUNSEA Telecommunicatio. It trades about -0.22 of its potential returns per unit of risk. SUNSEA Telecommunications Co is currently generating about -0.15 per unit of risk. If you would invest 950.00 in Shuhua Sports Co on October 16, 2024 and sell it today you would lose (171.00) from holding Shuhua Sports Co or give up 18.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shuhua Sports Co vs. SUNSEA Telecommunications Co
Performance |
| Timeline |
| Shuhua Sports |
| SUNSEA Telecommunicatio |
Shuhua Sports and SUNSEA Telecommunicatio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shuhua Sports and SUNSEA Telecommunicatio
The main advantage of trading using opposite Shuhua Sports and SUNSEA Telecommunicatio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shuhua Sports 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.| Shuhua Sports vs. Fujian Anjoy Foods | Shuhua Sports vs. Ligao Foods CoLtd | Shuhua Sports vs. Jilin Chemical Fibre | Shuhua Sports vs. Jinsanjiang Silicon Material |
| SUNSEA Telecommunicatio vs. China Sports Industry | SUNSEA Telecommunicatio vs. HeBei Jinniu Chemical | SUNSEA Telecommunicatio vs. Shuhua Sports Co | SUNSEA Telecommunicatio vs. Shandong Rike Chemical |
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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