Correlation Between China Sun and China Power
Can any of the company-specific risk be diversified away by investing in both China Sun and China Power at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining China Sun and China Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between China Sun Grp and China Power Equipment, you can compare the effects of market volatilities on China Sun and China Power 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 China Sun with a short position of China Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Sun and China Power.
Diversification Opportunities for China Sun and China Power
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between China and China is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding China Sun Grp and China Power Equipment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Power Equipment and China Sun 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 China Sun Grp are associated (or correlated) with China Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Power Equipment has no effect on the direction of China Sun i.e., China Sun and China Power go up and down completely randomly.
Pair Corralation between China Sun and China Power
If you would invest 0.10 in China Sun Grp on September 3, 2024 and sell it today you would lose (0.10) from holding China Sun Grp or give up 100.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 99.8% |
| Values | Daily Returns |
China Sun Grp vs. China Power Equipment
Performance |
| Timeline |
| China Sun Grp |
| China Power Equipment |
China Sun and China Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Sun and China Power
The main advantage of trading using opposite China Sun and China Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Sun position performs unexpectedly, China Power 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 China Power will offset losses from the drop in China Power's long position.| China Sun vs. Curtis Mathes Corp | China Sun vs. alpha En | China Sun vs. Ieh Corp | China Sun vs. Methode Electronics |
| China Power vs. KULR Technology Group | China Power vs. Ouster Inc | China Power vs. MicroCloud Hologram | China Power vs. Kopin |
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 Stock Tickers module to use high-impact, comprehensive, and customizable stock tickers that can be easily integrated to any websites.
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