Correlation Between Changchun and Saurer Intelligent
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By analyzing existing cross correlation between Changchun UP Optotech and Saurer Intelligent Technology, you can compare the effects of market volatilities on Changchun and Saurer Intelligent 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 Changchun with a short position of Saurer Intelligent. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changchun and Saurer Intelligent.
Diversification Opportunities for Changchun and Saurer Intelligent
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Changchun and Saurer is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Changchun UP Optotech and Saurer Intelligent Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Saurer Intelligent and Changchun 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 Changchun UP Optotech are associated (or correlated) with Saurer Intelligent. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Saurer Intelligent has no effect on the direction of Changchun i.e., Changchun and Saurer Intelligent go up and down completely randomly.
Pair Corralation between Changchun and Saurer Intelligent
Assuming the 90 days trading horizon Changchun is expected to generate 2.34 times less return on investment than Saurer Intelligent. But when comparing it to its historical volatility, Changchun UP Optotech is 1.09 times less risky than Saurer Intelligent. It trades about 0.2 of its potential returns per unit of risk. Saurer Intelligent Technology is currently generating about 0.42 of returns per unit of risk over similar time horizon. If you would invest 133.00 in Saurer Intelligent Technology on September 15, 2024 and sell it today you would earn a total of 252.00 from holding Saurer Intelligent Technology or generate 189.47% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Changchun UP Optotech vs. Saurer Intelligent Technology
Performance |
Timeline |
Changchun UP Optotech |
Saurer Intelligent |
Changchun and Saurer Intelligent Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Changchun and Saurer Intelligent
The main advantage of trading using opposite Changchun and Saurer Intelligent positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changchun position performs unexpectedly, Saurer Intelligent 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 Saurer Intelligent will offset losses from the drop in Saurer Intelligent's long position.Changchun vs. China Life Insurance | Changchun vs. Cinda Securities Co | Changchun vs. Piotech Inc A | Changchun vs. Dongxing Sec Co |
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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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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