Correlation Between Liaoning Dingjide and China Securities
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By analyzing existing cross correlation between Liaoning Dingjide Petrochemical and China Securities 800, you can compare the effects of market volatilities on Liaoning Dingjide and China Securities 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 Liaoning Dingjide with a short position of China Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liaoning Dingjide and China Securities.
Diversification Opportunities for Liaoning Dingjide and China Securities
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Liaoning and China is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Liaoning Dingjide Petrochemica and China Securities 800 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Securities 800 and Liaoning Dingjide 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 Liaoning Dingjide Petrochemical are associated (or correlated) with China Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Securities 800 has no effect on the direction of Liaoning Dingjide i.e., Liaoning Dingjide and China Securities go up and down completely randomly.
Pair Corralation between Liaoning Dingjide and China Securities
Assuming the 90 days trading horizon Liaoning Dingjide Petrochemical is expected to generate 2.84 times more return on investment than China Securities. However, Liaoning Dingjide is 2.84 times more volatile than China Securities 800. It trades about 0.06 of its potential returns per unit of risk. China Securities 800 is currently generating about 0.16 per unit of risk. If you would invest 3,063 in Liaoning Dingjide Petrochemical on September 26, 2024 and sell it today you would earn a total of 85.00 from holding Liaoning Dingjide Petrochemical or generate 2.78% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 95.65% |
Values | Daily Returns |
Liaoning Dingjide Petrochemica vs. China Securities 800
Performance |
Timeline |
Liaoning Dingjide and China Securities Volatility Contrast
Predicted Return Density |
Returns |
Liaoning Dingjide Petrochemical
Pair trading matchups for Liaoning Dingjide
China Securities 800
Pair trading matchups for China Securities
Pair Trading with Liaoning Dingjide and China Securities
The main advantage of trading using opposite Liaoning Dingjide and China Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liaoning Dingjide position performs unexpectedly, China Securities 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 China Securities will offset losses from the drop in China Securities' long position.Liaoning Dingjide vs. Lepu Medical Tech | Liaoning Dingjide vs. Guangdong Wens Foodstuff | Liaoning Dingjide vs. Cowealth Medical China | Liaoning Dingjide vs. Double Medical Technology |
China Securities vs. Caihong Display Devices | China Securities vs. Keda Clean Energy | China Securities vs. Easyhome New Retail | China Securities vs. Shanghai Yaoji Playing |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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