Correlation Between Kingclean Electric and Sinomach Automobile
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By analyzing existing cross correlation between Kingclean Electric Co and Sinomach Automobile Co, you can compare the effects of market volatilities on Kingclean Electric and Sinomach Automobile 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 Kingclean Electric with a short position of Sinomach Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Kingclean Electric and Sinomach Automobile.
Diversification Opportunities for Kingclean Electric and Sinomach Automobile
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Kingclean and Sinomach is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Kingclean Electric Co and Sinomach Automobile Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinomach Automobile and Kingclean Electric 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 Kingclean Electric Co are associated (or correlated) with Sinomach Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinomach Automobile has no effect on the direction of Kingclean Electric i.e., Kingclean Electric and Sinomach Automobile go up and down completely randomly.
Pair Corralation between Kingclean Electric and Sinomach Automobile
Assuming the 90 days trading horizon Kingclean Electric is expected to generate 1.64 times less return on investment than Sinomach Automobile. But when comparing it to its historical volatility, Kingclean Electric Co is 1.23 times less risky than Sinomach Automobile. It trades about 0.06 of its potential returns per unit of risk. Sinomach Automobile Co is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 597.00 in Sinomach Automobile Co on September 26, 2024 and sell it today you would earn a total of 72.00 from holding Sinomach Automobile Co or generate 12.06% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Kingclean Electric Co vs. Sinomach Automobile Co
Performance |
Timeline |
Kingclean Electric |
Sinomach Automobile |
Kingclean Electric and Sinomach Automobile Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Kingclean Electric and Sinomach Automobile
The main advantage of trading using opposite Kingclean Electric and Sinomach Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Kingclean Electric position performs unexpectedly, Sinomach Automobile 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 Sinomach Automobile will offset losses from the drop in Sinomach Automobile's long position.Kingclean Electric vs. Industrial and Commercial | Kingclean Electric vs. Kweichow Moutai Co | Kingclean Electric vs. Agricultural Bank of | Kingclean Electric vs. China Mobile Limited |
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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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