Correlation Between Changchun BCHT and Shannon Semiconductor
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By analyzing existing cross correlation between Changchun BCHT Biotechnology and Shannon Semiconductor Technology, you can compare the effects of market volatilities on Changchun BCHT and Shannon Semiconductor 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 Changchun BCHT with a short position of Shannon Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun BCHT and Shannon Semiconductor.
Diversification Opportunities for Changchun BCHT and Shannon Semiconductor
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Changchun and Shannon is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Changchun BCHT Biotechnology and Shannon Semiconductor Technolo in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shannon Semiconductor and Changchun BCHT 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 Changchun BCHT Biotechnology are associated (or correlated) with Shannon Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shannon Semiconductor has no effect on the direction of Changchun BCHT i.e., Changchun BCHT and Shannon Semiconductor go up and down completely randomly.
Pair Corralation between Changchun BCHT and Shannon Semiconductor
Assuming the 90 days trading horizon Changchun BCHT Biotechnology is expected to under-perform the Shannon Semiconductor. But the stock apears to be less risky and, when comparing its historical volatility, Changchun BCHT Biotechnology is 1.58 times less risky than Shannon Semiconductor. The stock trades about -0.07 of its potential returns per unit of risk. The Shannon Semiconductor Technology is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 2,749 in Shannon Semiconductor Technology on October 12, 2024 and sell it today you would lose (36.00) from holding Shannon Semiconductor Technology or give up 1.31% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun BCHT Biotechnology vs. Shannon Semiconductor Technolo
Performance |
| Timeline |
| Changchun BCHT Biote |
| Shannon Semiconductor |
Changchun BCHT and Shannon Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun BCHT and Shannon Semiconductor
The main advantage of trading using opposite Changchun BCHT and Shannon Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun BCHT position performs unexpectedly, Shannon Semiconductor 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 Shannon Semiconductor will offset losses from the drop in Shannon Semiconductor's long position.| Changchun BCHT vs. Jiangsu Yueda Investment | Changchun BCHT vs. Beijing Mainstreets Investment | Changchun BCHT vs. Yunnan Jianzhijia Health Chain | Changchun BCHT vs. Humanwell Healthcare Group |
| Shannon Semiconductor vs. JuneYao Dairy Co | Shannon Semiconductor vs. Tibet Huayu Mining | Shannon Semiconductor vs. Shenzhen Topway Video | Shannon Semiconductor vs. Shengda Mining 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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