Correlation Between Beijing Kingsoft and Sunwave Communications
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By analyzing existing cross correlation between Beijing Kingsoft Office and Sunwave Communications Co, you can compare the effects of market volatilities on Beijing Kingsoft and Sunwave Communications 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 Beijing Kingsoft with a short position of Sunwave Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Kingsoft and Sunwave Communications.
Diversification Opportunities for Beijing Kingsoft and Sunwave Communications
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Beijing and Sunwave is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Kingsoft Office and Sunwave Communications Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunwave Communications and Beijing Kingsoft 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 Beijing Kingsoft Office are associated (or correlated) with Sunwave Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunwave Communications has no effect on the direction of Beijing Kingsoft i.e., Beijing Kingsoft and Sunwave Communications go up and down completely randomly.
Pair Corralation between Beijing Kingsoft and Sunwave Communications
Assuming the 90 days trading horizon Beijing Kingsoft is expected to generate 2.83 times less return on investment than Sunwave Communications. In addition to that, Beijing Kingsoft is 1.09 times more volatile than Sunwave Communications Co. It trades about 0.01 of its total potential returns per unit of risk. Sunwave Communications Co is currently generating about 0.03 per unit of volatility. If you would invest 511.00 in Sunwave Communications Co on October 16, 2024 and sell it today you would earn a total of 114.00 from holding Sunwave Communications Co or generate 22.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Kingsoft Office vs. Sunwave Communications Co
Performance |
| Timeline |
| Beijing Kingsoft Office |
| Sunwave Communications |
Beijing Kingsoft and Sunwave Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Kingsoft and Sunwave Communications
The main advantage of trading using opposite Beijing Kingsoft and Sunwave Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Kingsoft position performs unexpectedly, Sunwave Communications 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 Sunwave Communications will offset losses from the drop in Sunwave Communications' long position.| Beijing Kingsoft vs. Financial Street Holdings | Beijing Kingsoft vs. China Everbright Bank | Beijing Kingsoft vs. Fuzhou Rockchip Electronics | Beijing Kingsoft vs. TongFu Microelectronics Co |
| Sunwave Communications vs. Jiahe Foods Industry | Sunwave Communications vs. Xinjiang Tianrun Dairy | Sunwave Communications vs. Qingdao Foods Co | Sunwave Communications vs. Shandong Longda Meat |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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