Correlation Between Shenzhou International and Unifi
Can any of the company-specific risk be diversified away by investing in both Shenzhou International and Unifi 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 Shenzhou International and Unifi into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shenzhou International Group and Unifi Inc, you can compare the effects of market volatilities on Shenzhou International and Unifi 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 Shenzhou International with a short position of Unifi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhou International and Unifi.
Diversification Opportunities for Shenzhou International and Unifi
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shenzhou and Unifi is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhou International Group and Unifi Inc in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Unifi Inc and Shenzhou International 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 Shenzhou International Group are associated (or correlated) with Unifi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Unifi Inc has no effect on the direction of Shenzhou International i.e., Shenzhou International and Unifi go up and down completely randomly.
Pair Corralation between Shenzhou International and Unifi
Assuming the 90 days horizon Shenzhou International Group is expected to generate 0.81 times more return on investment than Unifi. However, Shenzhou International Group is 1.24 times less risky than Unifi. It trades about 0.0 of its potential returns per unit of risk. Unifi Inc is currently generating about -0.01 per unit of risk. If you would invest 938.00 in Shenzhou International Group on August 24, 2024 and sell it today you would lose (162.00) from holding Shenzhou International Group or give up 17.27% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhou International Group vs. Unifi Inc
Performance |
| Timeline |
| Shenzhou International |
| Unifi Inc |
Shenzhou International and Unifi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhou International and Unifi
The main advantage of trading using opposite Shenzhou International and Unifi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhou International position performs unexpectedly, Unifi 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 Unifi will offset losses from the drop in Unifi's long position.| Shenzhou International vs. Unifi Inc | Shenzhou International vs. Culp Inc | Shenzhou International vs. ENN Energy Holdings | Shenzhou International vs. Anhui Conch Cement |
| Unifi vs. Albany International | Unifi vs. Toray Industries | Unifi vs. Culp Inc | Unifi vs. Toray Industries ADR |
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 Portfolio File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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