Correlation Between Sunwave Communications and Changjiang Jinggong
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By analyzing existing cross correlation between Sunwave Communications Co and Changjiang Jinggong Steel, you can compare the effects of market volatilities on Sunwave Communications and Changjiang Jinggong 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 Sunwave Communications with a short position of Changjiang Jinggong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sunwave Communications and Changjiang Jinggong.
Diversification Opportunities for Sunwave Communications and Changjiang Jinggong
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sunwave and Changjiang is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Sunwave Communications Co and Changjiang Jinggong Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changjiang Jinggong Steel and Sunwave Communications 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 Sunwave Communications Co are associated (or correlated) with Changjiang Jinggong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changjiang Jinggong Steel has no effect on the direction of Sunwave Communications i.e., Sunwave Communications and Changjiang Jinggong go up and down completely randomly.
Pair Corralation between Sunwave Communications and Changjiang Jinggong
Assuming the 90 days trading horizon Sunwave Communications Co is expected to generate 1.72 times more return on investment than Changjiang Jinggong. However, Sunwave Communications is 1.72 times more volatile than Changjiang Jinggong Steel. It trades about 0.24 of its potential returns per unit of risk. Changjiang Jinggong Steel is currently generating about 0.22 per unit of risk. If you would invest 433.00 in Sunwave Communications Co on September 7, 2024 and sell it today you would earn a total of 293.00 from holding Sunwave Communications Co or generate 67.67% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Sunwave Communications Co vs. Changjiang Jinggong Steel
Performance |
Timeline |
Sunwave Communications |
Changjiang Jinggong Steel |
Sunwave Communications and Changjiang Jinggong Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sunwave Communications and Changjiang Jinggong
The main advantage of trading using opposite Sunwave Communications and Changjiang Jinggong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sunwave Communications position performs unexpectedly, Changjiang Jinggong 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 Changjiang Jinggong will offset losses from the drop in Changjiang Jinggong's long position.Sunwave Communications vs. Industrial and Commercial | Sunwave Communications vs. Agricultural Bank of | Sunwave Communications vs. China Construction Bank | Sunwave Communications 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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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