Correlation Between Kunshan Guoli and Leaguer Shenzhen
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By analyzing existing cross correlation between Kunshan Guoli Electronic and Leaguer Shenzhen MicroElectronics, you can compare the effects of market volatilities on Kunshan Guoli and Leaguer 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 Kunshan Guoli with a short position of Leaguer Shenzhen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kunshan Guoli and Leaguer Shenzhen.
Diversification Opportunities for Kunshan Guoli and Leaguer Shenzhen
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Kunshan and Leaguer is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Kunshan Guoli Electronic and Leaguer Shenzhen MicroElectron in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Leaguer Shenzhen Mic and Kunshan Guoli 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 Kunshan Guoli Electronic are associated (or correlated) with Leaguer Shenzhen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Leaguer Shenzhen Mic has no effect on the direction of Kunshan Guoli i.e., Kunshan Guoli and Leaguer Shenzhen go up and down completely randomly.
Pair Corralation between Kunshan Guoli and Leaguer Shenzhen
Assuming the 90 days trading horizon Kunshan Guoli Electronic is expected to under-perform the Leaguer Shenzhen. In addition to that, Kunshan Guoli is 1.21 times more volatile than Leaguer Shenzhen MicroElectronics. It trades about -0.02 of its total potential returns per unit of risk. Leaguer Shenzhen MicroElectronics is currently generating about 0.01 per unit of volatility. If you would invest 2,830 in Leaguer Shenzhen MicroElectronics on August 30, 2024 and sell it today you would lose (17.00) from holding Leaguer Shenzhen MicroElectronics or give up 0.6% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Kunshan Guoli Electronic vs. Leaguer Shenzhen MicroElectron
Performance |
| Timeline |
| Kunshan Guoli Electronic |
| Leaguer Shenzhen Mic |
Kunshan Guoli and Leaguer Shenzhen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Kunshan Guoli and Leaguer Shenzhen
The main advantage of trading using opposite Kunshan Guoli and Leaguer Shenzhen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kunshan Guoli position performs unexpectedly, Leaguer 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 Leaguer Shenzhen will offset losses from the drop in Leaguer Shenzhen's long position.| Kunshan Guoli vs. Cultural Investment Holdings | Kunshan Guoli vs. Gome Telecom Equipment | Kunshan Guoli vs. Bus Online Co | Kunshan Guoli vs. Holitech Technology Co |
| Leaguer Shenzhen vs. Ming Yang Smart | Leaguer Shenzhen vs. 159681 | Leaguer Shenzhen vs. 159005 | Leaguer Shenzhen vs. 516220 |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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