Correlation Between Daoming OpticsChemical and Wuliangye Yibin
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By analyzing existing cross correlation between Daoming OpticsChemical Co and Wuliangye Yibin Co, you can compare the effects of market volatilities on Daoming OpticsChemical and Wuliangye Yibin 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 Daoming OpticsChemical with a short position of Wuliangye Yibin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daoming OpticsChemical and Wuliangye Yibin.
Diversification Opportunities for Daoming OpticsChemical and Wuliangye Yibin
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Daoming and Wuliangye is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Daoming OpticsChemical Co and Wuliangye Yibin Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wuliangye Yibin and Daoming OpticsChemical 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 Daoming OpticsChemical Co are associated (or correlated) with Wuliangye Yibin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wuliangye Yibin has no effect on the direction of Daoming OpticsChemical i.e., Daoming OpticsChemical and Wuliangye Yibin go up and down completely randomly.
Pair Corralation between Daoming OpticsChemical and Wuliangye Yibin
Assuming the 90 days trading horizon Daoming OpticsChemical Co is expected to generate 1.76 times more return on investment than Wuliangye Yibin. However, Daoming OpticsChemical is 1.76 times more volatile than Wuliangye Yibin Co. It trades about 0.04 of its potential returns per unit of risk. Wuliangye Yibin Co is currently generating about 0.03 per unit of risk. If you would invest 739.00 in Daoming OpticsChemical Co on September 19, 2024 and sell it today you would earn a total of 141.00 from holding Daoming OpticsChemical Co or generate 19.08% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Daoming OpticsChemical Co vs. Wuliangye Yibin Co
Performance |
Timeline |
Daoming OpticsChemical |
Wuliangye Yibin |
Daoming OpticsChemical and Wuliangye Yibin Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Daoming OpticsChemical and Wuliangye Yibin
The main advantage of trading using opposite Daoming OpticsChemical and Wuliangye Yibin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daoming OpticsChemical position performs unexpectedly, Wuliangye Yibin 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 Wuliangye Yibin will offset losses from the drop in Wuliangye Yibin's long position.Daoming OpticsChemical vs. Zijin Mining Group | Daoming OpticsChemical vs. Wanhua Chemical Group | Daoming OpticsChemical vs. Baoshan Iron Steel | Daoming OpticsChemical vs. Shandong Gold Mining |
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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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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