Correlation Between Flat Glass and Dongguan Chitwing
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By analyzing existing cross correlation between Flat Glass Group and Dongguan Chitwing Technology, you can compare the effects of market volatilities on Flat Glass and Dongguan Chitwing 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 Flat Glass with a short position of Dongguan Chitwing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Flat Glass and Dongguan Chitwing.
Diversification Opportunities for Flat Glass and Dongguan Chitwing
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Flat and Dongguan is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Flat Glass Group and Dongguan Chitwing Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongguan Chitwing and Flat Glass 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 Flat Glass Group are associated (or correlated) with Dongguan Chitwing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongguan Chitwing has no effect on the direction of Flat Glass i.e., Flat Glass and Dongguan Chitwing go up and down completely randomly.
Pair Corralation between Flat Glass and Dongguan Chitwing
Assuming the 90 days trading horizon Flat Glass Group is expected to under-perform the Dongguan Chitwing. But the stock apears to be less risky and, when comparing its historical volatility, Flat Glass Group is 1.77 times less risky than Dongguan Chitwing. The stock trades about -0.9 of its potential returns per unit of risk. The Dongguan Chitwing Technology is currently generating about -0.39 of returns per unit of risk over similar time horizon. If you would invest 2,292 in Dongguan Chitwing Technology on October 5, 2024 and sell it today you would lose (418.00) from holding Dongguan Chitwing Technology or give up 18.24% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Flat Glass Group vs. Dongguan Chitwing Technology
Performance |
Timeline |
Flat Glass Group |
Dongguan Chitwing |
Flat Glass and Dongguan Chitwing Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Flat Glass and Dongguan Chitwing
The main advantage of trading using opposite Flat Glass and Dongguan Chitwing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Flat Glass position performs unexpectedly, Dongguan Chitwing 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 Dongguan Chitwing will offset losses from the drop in Dongguan Chitwing's long position.Flat Glass vs. Tongyu Communication | Flat Glass vs. Jiahe Foods Industry | Flat Glass vs. Xiangpiaopiao Food Co | Flat Glass vs. Zhongyin Babi Food |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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