Correlation Between Sichuan Hebang and Strait Innovation
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By analyzing existing cross correlation between Sichuan Hebang Biotechnology and Strait Innovation Internet, you can compare the effects of market volatilities on Sichuan Hebang and Strait Innovation 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 Sichuan Hebang with a short position of Strait Innovation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sichuan Hebang and Strait Innovation.
Diversification Opportunities for Sichuan Hebang and Strait Innovation
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sichuan and Strait is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Sichuan Hebang Biotechnology and Strait Innovation Internet in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Strait Innovation and Sichuan Hebang 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 Sichuan Hebang Biotechnology are associated (or correlated) with Strait Innovation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Strait Innovation has no effect on the direction of Sichuan Hebang i.e., Sichuan Hebang and Strait Innovation go up and down completely randomly.
Pair Corralation between Sichuan Hebang and Strait Innovation
Assuming the 90 days trading horizon Sichuan Hebang is expected to generate 4.12 times less return on investment than Strait Innovation. But when comparing it to its historical volatility, Sichuan Hebang Biotechnology is 1.75 times less risky than Strait Innovation. It trades about 0.09 of its potential returns per unit of risk. Strait Innovation Internet is currently generating about 0.22 of returns per unit of risk over similar time horizon. If you would invest 165.00 in Strait Innovation Internet on September 26, 2024 and sell it today you would earn a total of 137.00 from holding Strait Innovation Internet or generate 83.03% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Sichuan Hebang Biotechnology vs. Strait Innovation Internet
Performance |
Timeline |
Sichuan Hebang Biote |
Strait Innovation |
Sichuan Hebang and Strait Innovation Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sichuan Hebang and Strait Innovation
The main advantage of trading using opposite Sichuan Hebang and Strait Innovation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sichuan Hebang position performs unexpectedly, Strait Innovation 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 Strait Innovation will offset losses from the drop in Strait Innovation's long position.Sichuan Hebang vs. Zijin Mining Group | Sichuan Hebang vs. Wanhua Chemical Group | Sichuan Hebang vs. Baoshan Iron Steel | Sichuan Hebang vs. Shandong Gold Mining |
Strait Innovation vs. Kweichow Moutai Co | Strait Innovation vs. Shenzhen Mindray Bio Medical | Strait Innovation vs. Jiangsu Pacific Quartz | Strait Innovation vs. G bits Network Technology |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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