Correlation Between Capital Income and Shantui Construction
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By analyzing existing cross correlation between Capital Income Builder and Shantui Construction Machinery, you can compare the effects of market volatilities on Capital Income and Shantui Construction 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 Capital Income with a short position of Shantui Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Capital Income and Shantui Construction.
Diversification Opportunities for Capital Income and Shantui Construction
-0.04 | Correlation Coefficient |
Good diversification
The 3 months correlation between Capital and Shantui is -0.04. Overlapping area represents the amount of risk that can be diversified away by holding Capital Income Builder and Shantui Construction Machinery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shantui Construction and Capital Income 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 Capital Income Builder are associated (or correlated) with Shantui Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shantui Construction has no effect on the direction of Capital Income i.e., Capital Income and Shantui Construction go up and down completely randomly.
Pair Corralation between Capital Income and Shantui Construction
Assuming the 90 days horizon Capital Income is expected to generate 6.38 times less return on investment than Shantui Construction. But when comparing it to its historical volatility, Capital Income Builder is 6.08 times less risky than Shantui Construction. It trades about 0.08 of its potential returns per unit of risk. Shantui Construction Machinery is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 577.00 in Shantui Construction Machinery on November 3, 2024 and sell it today you would earn a total of 426.00 from holding Shantui Construction Machinery or generate 73.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.14% |
| Values | Daily Returns |
Capital Income Builder vs. Shantui Construction Machinery
Performance |
| Timeline |
| Capital Income Builder |
| Shantui Construction |
Capital Income and Shantui Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Capital Income and Shantui Construction
The main advantage of trading using opposite Capital Income and Shantui Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Capital Income position performs unexpectedly, Shantui Construction 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 Shantui Construction will offset losses from the drop in Shantui Construction's long position.| Capital Income vs. Blackrock Financial Institutions | Capital Income vs. Fidelity Advisor Financial | Capital Income vs. Blackstone Secured Lending | Capital Income vs. 1919 Financial Services |
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 Stocks Directory module to find actively traded stocks across global markets.
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