Correlation Between Changchun BCHT and Caihong Display
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By analyzing existing cross correlation between Changchun BCHT Biotechnology and Caihong Display Devices, you can compare the effects of market volatilities on Changchun BCHT and Caihong Display 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 Caihong Display. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun BCHT and Caihong Display.
Diversification Opportunities for Changchun BCHT and Caihong Display
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Changchun and Caihong is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Changchun BCHT Biotechnology and Caihong Display Devices in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Caihong Display Devices 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 Caihong Display. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Caihong Display Devices has no effect on the direction of Changchun BCHT i.e., Changchun BCHT and Caihong Display go up and down completely randomly.
Pair Corralation between Changchun BCHT and Caihong Display
Assuming the 90 days trading horizon Changchun BCHT Biotechnology is expected to under-perform the Caihong Display. But the stock apears to be less risky and, when comparing its historical volatility, Changchun BCHT Biotechnology is 1.51 times less risky than Caihong Display. The stock trades about -0.42 of its potential returns per unit of risk. The Caihong Display Devices is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 811.00 in Caihong Display Devices on October 14, 2024 and sell it today you would lose (27.00) from holding Caihong Display Devices or give up 3.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun BCHT Biotechnology vs. Caihong Display Devices
Performance |
| Timeline |
| Changchun BCHT Biote |
| Caihong Display Devices |
Changchun BCHT and Caihong Display Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun BCHT and Caihong Display
The main advantage of trading using opposite Changchun BCHT and Caihong Display positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun BCHT position performs unexpectedly, Caihong Display 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 Caihong Display will offset losses from the drop in Caihong Display's long position.| Changchun BCHT vs. Qingdao Foods Co | Changchun BCHT vs. Aba Chemicals Corp | Changchun BCHT vs. State Grid InformationCommunication | Changchun BCHT vs. Dymatic Chemicals |
| Caihong Display vs. Shenzhen SDG Information | Caihong Display vs. Suzhou Douson Drilling | Caihong Display vs. East Money Information | Caihong Display vs. Kunwu Jiuding Investment |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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