Correlation Between China Satellite and Shanghai Jinfeng
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By analyzing existing cross correlation between China Satellite Communications and Shanghai Jinfeng Wine, you can compare the effects of market volatilities on China Satellite and Shanghai Jinfeng 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 China Satellite with a short position of Shanghai Jinfeng. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Satellite and Shanghai Jinfeng.
Diversification Opportunities for China Satellite and Shanghai Jinfeng
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Shanghai is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding China Satellite Communications and Shanghai Jinfeng Wine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Jinfeng Wine and China Satellite 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 China Satellite Communications are associated (or correlated) with Shanghai Jinfeng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Jinfeng Wine has no effect on the direction of China Satellite i.e., China Satellite and Shanghai Jinfeng go up and down completely randomly.
Pair Corralation between China Satellite and Shanghai Jinfeng
Assuming the 90 days trading horizon China Satellite Communications is expected to generate 0.81 times more return on investment than Shanghai Jinfeng. However, China Satellite Communications is 1.23 times less risky than Shanghai Jinfeng. It trades about 0.07 of its potential returns per unit of risk. Shanghai Jinfeng Wine is currently generating about 0.02 per unit of risk. If you would invest 2,059 in China Satellite Communications on September 26, 2024 and sell it today you would earn a total of 87.00 from holding China Satellite Communications or generate 4.23% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
China Satellite Communications vs. Shanghai Jinfeng Wine
Performance |
Timeline |
China Satellite Comm |
Shanghai Jinfeng Wine |
China Satellite and Shanghai Jinfeng Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with China Satellite and Shanghai Jinfeng
The main advantage of trading using opposite China Satellite and Shanghai Jinfeng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Satellite position performs unexpectedly, Shanghai Jinfeng 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 Shanghai Jinfeng will offset losses from the drop in Shanghai Jinfeng's long position.China Satellite vs. Jiangsu GDK Biotechnology | China Satellite vs. Guangdong Shenglu Telecommunication | China Satellite vs. Guangxi Wuzhou Communications | China Satellite vs. Changchun BCHT Biotechnology |
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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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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