Correlation Between Giantec Semiconductor and Chongqing Sulian
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By analyzing existing cross correlation between Giantec Semiconductor Corp and Chongqing Sulian Plastic, you can compare the effects of market volatilities on Giantec Semiconductor and Chongqing Sulian 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 Giantec Semiconductor with a short position of Chongqing Sulian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Giantec Semiconductor and Chongqing Sulian.
Diversification Opportunities for Giantec Semiconductor and Chongqing Sulian
0.15 | Correlation Coefficient |
Average diversification
The 3 months correlation between Giantec and Chongqing is 0.15. Overlapping area represents the amount of risk that can be diversified away by holding Giantec Semiconductor Corp and Chongqing Sulian Plastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Sulian Plastic and Giantec Semiconductor 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 Giantec Semiconductor Corp are associated (or correlated) with Chongqing Sulian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chongqing Sulian Plastic has no effect on the direction of Giantec Semiconductor i.e., Giantec Semiconductor and Chongqing Sulian go up and down completely randomly.
Pair Corralation between Giantec Semiconductor and Chongqing Sulian
Assuming the 90 days trading horizon Giantec Semiconductor is expected to generate 1.2 times less return on investment than Chongqing Sulian. But when comparing it to its historical volatility, Giantec Semiconductor Corp is 1.1 times less risky than Chongqing Sulian. It trades about 0.11 of its potential returns per unit of risk. Chongqing Sulian Plastic is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 2,591 in Chongqing Sulian Plastic on October 30, 2024 and sell it today you would earn a total of 291.00 from holding Chongqing Sulian Plastic or generate 11.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Giantec Semiconductor Corp vs. Chongqing Sulian Plastic
Performance |
| Timeline |
| Giantec Semiconductor |
| Chongqing Sulian Plastic |
Giantec Semiconductor and Chongqing Sulian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Giantec Semiconductor and Chongqing Sulian
The main advantage of trading using opposite Giantec Semiconductor and Chongqing Sulian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Giantec Semiconductor position performs unexpectedly, Chongqing Sulian 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 Chongqing Sulian will offset losses from the drop in Chongqing Sulian's long position.The idea behind Giantec Semiconductor Corp and Chongqing Sulian Plastic 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.
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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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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