Correlation Between Wuhan Yangtze and Shenzhen Centralcon
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By analyzing existing cross correlation between Wuhan Yangtze Communication and Shenzhen Centralcon Investment, you can compare the effects of market volatilities on Wuhan Yangtze and Shenzhen Centralcon 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 Wuhan Yangtze with a short position of Shenzhen Centralcon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wuhan Yangtze and Shenzhen Centralcon.
Diversification Opportunities for Wuhan Yangtze and Shenzhen Centralcon
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Wuhan and Shenzhen is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Wuhan Yangtze Communication and Shenzhen Centralcon Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Centralcon and Wuhan Yangtze 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 Wuhan Yangtze Communication are associated (or correlated) with Shenzhen Centralcon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Centralcon has no effect on the direction of Wuhan Yangtze i.e., Wuhan Yangtze and Shenzhen Centralcon go up and down completely randomly.
Pair Corralation between Wuhan Yangtze and Shenzhen Centralcon
Assuming the 90 days trading horizon Wuhan Yangtze Communication is expected to generate 1.42 times more return on investment than Shenzhen Centralcon. However, Wuhan Yangtze is 1.42 times more volatile than Shenzhen Centralcon Investment. It trades about 0.15 of its potential returns per unit of risk. Shenzhen Centralcon Investment is currently generating about 0.1 per unit of risk. If you would invest 1,652 in Wuhan Yangtze Communication on September 26, 2024 and sell it today you would earn a total of 761.00 from holding Wuhan Yangtze Communication or generate 46.07% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Wuhan Yangtze Communication vs. Shenzhen Centralcon Investment
Performance |
Timeline |
Wuhan Yangtze Commun |
Shenzhen Centralcon |
Wuhan Yangtze and Shenzhen Centralcon Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Wuhan Yangtze and Shenzhen Centralcon
The main advantage of trading using opposite Wuhan Yangtze and Shenzhen Centralcon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wuhan Yangtze position performs unexpectedly, Shenzhen Centralcon 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 Shenzhen Centralcon will offset losses from the drop in Shenzhen Centralcon's long position.Wuhan Yangtze vs. Eastern Air Logistics | Wuhan Yangtze vs. Hengli Industrial Development | Wuhan Yangtze vs. Anhui Gujing Distillery | Wuhan Yangtze vs. Qingdao Choho Industrial |
Shenzhen Centralcon vs. Western Metal Materials | Shenzhen Centralcon vs. Sunny Loan Top | Shenzhen Centralcon vs. Sinomach General Machinery | Shenzhen Centralcon vs. Sichuan Yahua Industrial |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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