Correlation Between Stellar and Sanan Optoelectronics
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By analyzing existing cross correlation between Stellar and Sanan Optoelectronics Co, you can compare the effects of market volatilities on Stellar and Sanan Optoelectronics 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 Stellar with a short position of Sanan Optoelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Stellar and Sanan Optoelectronics.
Diversification Opportunities for Stellar and Sanan Optoelectronics
-0.6 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Stellar and Sanan is -0.6. Overlapping area represents the amount of risk that can be diversified away by holding Stellar and Sanan Optoelectronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sanan Optoelectronics and Stellar 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 Stellar are associated (or correlated) with Sanan Optoelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sanan Optoelectronics has no effect on the direction of Stellar i.e., Stellar and Sanan Optoelectronics go up and down completely randomly.
Pair Corralation between Stellar and Sanan Optoelectronics
Assuming the 90 days trading horizon Stellar is expected to generate 3.67 times more return on investment than Sanan Optoelectronics. However, Stellar is 3.67 times more volatile than Sanan Optoelectronics Co. It trades about 0.19 of its potential returns per unit of risk. Sanan Optoelectronics Co is currently generating about 0.06 per unit of risk. If you would invest 9.16 in Stellar on November 2, 2024 and sell it today you would earn a total of 33.84 from holding Stellar or generate 369.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 91.59% |
| Values | Daily Returns |
Stellar vs. Sanan Optoelectronics Co
Performance |
| Timeline |
| Stellar |
| Sanan Optoelectronics |
Stellar and Sanan Optoelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Stellar and Sanan Optoelectronics
The main advantage of trading using opposite Stellar and Sanan Optoelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Stellar position performs unexpectedly, Sanan Optoelectronics 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 Sanan Optoelectronics will offset losses from the drop in Sanan Optoelectronics' long position.The idea behind Stellar and Sanan Optoelectronics Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Sanan Optoelectronics vs. SSAW Hotels Resorts | Sanan Optoelectronics vs. Sichuan Fulin Transportation | Sanan Optoelectronics vs. Qijing Machinery | Sanan Optoelectronics vs. Guangzhou Dongfang Hotel |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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