Correlation Between Changchun BCHT and Union Semiconductor
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By analyzing existing cross correlation between Changchun BCHT Biotechnology and Union Semiconductor Co, you can compare the effects of market volatilities on Changchun BCHT and Union 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 Union Semiconductor. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun BCHT and Union Semiconductor.
Diversification Opportunities for Changchun BCHT and Union Semiconductor
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Changchun and Union is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Changchun BCHT Biotechnology and Union Semiconductor Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Union 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 Union Semiconductor. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Union Semiconductor has no effect on the direction of Changchun BCHT i.e., Changchun BCHT and Union Semiconductor go up and down completely randomly.
Pair Corralation between Changchun BCHT and Union Semiconductor
Assuming the 90 days trading horizon Changchun BCHT Biotechnology is expected to under-perform the Union Semiconductor. In addition to that, Changchun BCHT is 1.02 times more volatile than Union Semiconductor Co. It trades about -0.05 of its total potential returns per unit of risk. Union Semiconductor Co is currently generating about 0.05 per unit of volatility. If you would invest 732.00 in Union Semiconductor Co on November 3, 2024 and sell it today you would earn a total of 117.00 from holding Union Semiconductor Co or generate 15.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changchun BCHT Biotechnology vs. Union Semiconductor Co
Performance |
| Timeline |
| Changchun BCHT Biote |
| Union Semiconductor |
Changchun BCHT and Union Semiconductor Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changchun BCHT and Union Semiconductor
The main advantage of trading using opposite Changchun BCHT and Union Semiconductor positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun BCHT position performs unexpectedly, Union 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 Union Semiconductor will offset losses from the drop in Union Semiconductor's long position.| Changchun BCHT vs. PetroChina Co Ltd | Changchun BCHT vs. China Railway Construction | Changchun BCHT vs. China Mobile Limited | Changchun BCHT vs. Industrial and Commercial |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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