Correlation Between Shenzhen Zhongzhuang and Bomesc Offshore
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By analyzing existing cross correlation between Shenzhen Zhongzhuang Construction and Bomesc Offshore Engineering, you can compare the effects of market volatilities on Shenzhen Zhongzhuang and Bomesc Offshore 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 Shenzhen Zhongzhuang with a short position of Bomesc Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Zhongzhuang and Bomesc Offshore.
Diversification Opportunities for Shenzhen Zhongzhuang and Bomesc Offshore
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shenzhen and Bomesc is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Zhongzhuang Construct and Bomesc Offshore Engineering in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bomesc Offshore Engi and Shenzhen Zhongzhuang 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 Shenzhen Zhongzhuang Construction are associated (or correlated) with Bomesc Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bomesc Offshore Engi has no effect on the direction of Shenzhen Zhongzhuang i.e., Shenzhen Zhongzhuang and Bomesc Offshore go up and down completely randomly.
Pair Corralation between Shenzhen Zhongzhuang and Bomesc Offshore
Assuming the 90 days trading horizon Shenzhen Zhongzhuang Construction is expected to generate 1.82 times more return on investment than Bomesc Offshore. However, Shenzhen Zhongzhuang is 1.82 times more volatile than Bomesc Offshore Engineering. It trades about 0.17 of its potential returns per unit of risk. Bomesc Offshore Engineering is currently generating about -0.08 per unit of risk. If you would invest 383.00 in Shenzhen Zhongzhuang Construction on September 26, 2024 and sell it today you would earn a total of 38.00 from holding Shenzhen Zhongzhuang Construction or generate 9.92% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Shenzhen Zhongzhuang Construct vs. Bomesc Offshore Engineering
Performance |
Timeline |
Shenzhen Zhongzhuang |
Bomesc Offshore Engi |
Shenzhen Zhongzhuang and Bomesc Offshore Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Shenzhen Zhongzhuang and Bomesc Offshore
The main advantage of trading using opposite Shenzhen Zhongzhuang and Bomesc Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Zhongzhuang position performs unexpectedly, Bomesc Offshore 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 Bomesc Offshore will offset losses from the drop in Bomesc Offshore's long position.Shenzhen Zhongzhuang vs. Ming Yang Smart | Shenzhen Zhongzhuang vs. 159681 | Shenzhen Zhongzhuang vs. 159005 | Shenzhen Zhongzhuang vs. Loctek Ergonomic Technology |
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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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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