Correlation Between Dawning Information and Shanghai Material
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By analyzing existing cross correlation between Dawning Information Industry and Shanghai Material Trading, you can compare the effects of market volatilities on Dawning Information and Shanghai Material 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 Dawning Information with a short position of Shanghai Material. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dawning Information and Shanghai Material.
Diversification Opportunities for Dawning Information and Shanghai Material
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dawning and Shanghai is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Dawning Information Industry and Shanghai Material Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Material Trading and Dawning Information 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 Dawning Information Industry are associated (or correlated) with Shanghai Material. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Material Trading has no effect on the direction of Dawning Information i.e., Dawning Information and Shanghai Material go up and down completely randomly.
Pair Corralation between Dawning Information and Shanghai Material
Assuming the 90 days trading horizon Dawning Information Industry is expected to generate 1.01 times more return on investment than Shanghai Material. However, Dawning Information is 1.01 times more volatile than Shanghai Material Trading. It trades about 0.12 of its potential returns per unit of risk. Shanghai Material Trading is currently generating about 0.06 per unit of risk. If you would invest 5,101 in Dawning Information Industry on October 11, 2024 and sell it today you would earn a total of 1,443 from holding Dawning Information Industry or generate 28.29% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Dawning Information Industry vs. Shanghai Material Trading
Performance |
Timeline |
Dawning Information |
Shanghai Material Trading |
Dawning Information and Shanghai Material Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Dawning Information and Shanghai Material
The main advantage of trading using opposite Dawning Information and Shanghai Material positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dawning Information position performs unexpectedly, Shanghai Material 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 Material will offset losses from the drop in Shanghai Material's long position.Dawning Information vs. Nanxing Furniture Machinery | Dawning Information vs. Grandblue Environment Co | Dawning Information vs. Wangneng Environment Co | Dawning Information vs. Oppein Home Group |
Shanghai Material vs. Songz Automobile Air | Shanghai Material vs. Zhejiang Qianjiang Motorcycle | Shanghai Material vs. Jiangsu Xinri E Vehicle | Shanghai Material vs. Dawning Information Industry |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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