Correlation Between Chinese Maritime and Sun Sea
Can any of the company-specific risk be diversified away by investing in both Chinese Maritime and Sun Sea at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Chinese Maritime and Sun Sea into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Chinese Maritime Transport and Sun Sea Construction, you can compare the effects of market volatilities on Chinese Maritime and Sun Sea 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 Chinese Maritime with a short position of Sun Sea. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chinese Maritime and Sun Sea.
Diversification Opportunities for Chinese Maritime and Sun Sea
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Chinese and Sun is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Chinese Maritime Transport and Sun Sea Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sun Sea Construction and Chinese Maritime 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 Chinese Maritime Transport are associated (or correlated) with Sun Sea. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sun Sea Construction has no effect on the direction of Chinese Maritime i.e., Chinese Maritime and Sun Sea go up and down completely randomly.
Pair Corralation between Chinese Maritime and Sun Sea
Assuming the 90 days trading horizon Chinese Maritime Transport is expected to under-perform the Sun Sea. But the stock apears to be less risky and, when comparing its historical volatility, Chinese Maritime Transport is 1.2 times less risky than Sun Sea. The stock trades about -0.23 of its potential returns per unit of risk. The Sun Sea Construction is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,850 in Sun Sea Construction on October 12, 2024 and sell it today you would earn a total of 40.00 from holding Sun Sea Construction or generate 2.16% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Chinese Maritime Transport vs. Sun Sea Construction
Performance |
Timeline |
Chinese Maritime Tra |
Sun Sea Construction |
Chinese Maritime and Sun Sea Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Chinese Maritime and Sun Sea
The main advantage of trading using opposite Chinese Maritime and Sun Sea positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chinese Maritime position performs unexpectedly, Sun Sea 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 Sun Sea will offset losses from the drop in Sun Sea's long position.Chinese Maritime vs. U Ming Marine Transport | Chinese Maritime vs. Sincere Navigation Corp | Chinese Maritime vs. Taiwan Navigation Co | Chinese Maritime vs. Huaku Development Co |
Sun Sea vs. Simplo Technology Co | Sun Sea vs. Fubon Taiwan Technology | Sun Sea vs. Sports Gear Co | Sun Sea vs. Chinese Maritime Transport |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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