Correlation Between Liaoning Chengda and Soyea Technology
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By analyzing existing cross correlation between Liaoning Chengda Biotechnology and Soyea Technology Co, you can compare the effects of market volatilities on Liaoning Chengda and Soyea Technology 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 Liaoning Chengda with a short position of Soyea Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liaoning Chengda and Soyea Technology.
Diversification Opportunities for Liaoning Chengda and Soyea Technology
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Liaoning and Soyea is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Liaoning Chengda Biotechnology and Soyea Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Soyea Technology and Liaoning Chengda 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 Liaoning Chengda Biotechnology are associated (or correlated) with Soyea Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Soyea Technology has no effect on the direction of Liaoning Chengda i.e., Liaoning Chengda and Soyea Technology go up and down completely randomly.
Pair Corralation between Liaoning Chengda and Soyea Technology
Assuming the 90 days trading horizon Liaoning Chengda is expected to generate 4.69 times less return on investment than Soyea Technology. But when comparing it to its historical volatility, Liaoning Chengda Biotechnology is 1.29 times less risky than Soyea Technology. It trades about 0.04 of its potential returns per unit of risk. Soyea Technology Co is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 338.00 in Soyea Technology Co on September 27, 2024 and sell it today you would earn a total of 203.00 from holding Soyea Technology Co or generate 60.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Liaoning Chengda Biotechnology vs. Soyea Technology Co
Performance |
| Timeline |
| Liaoning Chengda Bio |
| Soyea Technology |
Liaoning Chengda and Soyea Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liaoning Chengda and Soyea Technology
The main advantage of trading using opposite Liaoning Chengda and Soyea Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liaoning Chengda position performs unexpectedly, Soyea Technology 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 Soyea Technology will offset losses from the drop in Soyea Technology's long position.| Liaoning Chengda vs. Industrial and Commercial | Liaoning Chengda vs. Agricultural Bank of | Liaoning Chengda vs. China Construction Bank | Liaoning Chengda vs. Bank of China |
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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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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