Correlation Between Yuanjie Semiconductor and Citic Offshore

Can any of the company-specific risk be diversified away by investing in both Yuanjie Semiconductor and Citic Offshore at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Yuanjie Semiconductor and Citic Offshore into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Yuanjie Semiconductor Technology and Citic Offshore Helicopter, you can compare the effects of market volatilities on Yuanjie Semiconductor and Citic Offshore 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 Yuanjie Semiconductor with a short position of Citic Offshore. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuanjie Semiconductor and Citic Offshore.

Diversification Opportunities for Yuanjie Semiconductor and Citic Offshore

-0.07

Correlation Coefficient

Yuanjie Semiconductor  Citic Offshore

Good diversification

The 3 months correlation between Yuanjie and Citic is -0.07. Overlapping area represents the amount of risk that can be diversified away by holding Yuanjie Semiconductor Technolo and Citic Offshore Helicopter in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citic Offshore Helicopter and Yuanjie Semiconductor 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 Yuanjie Semiconductor Technology are associated (or correlated) with Citic Offshore. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citic Offshore Helicopter has no effect on the direction of Yuanjie Semiconductor i.e., Yuanjie Semiconductor and Citic Offshore go up and down completely randomly.

Pair Corralation between Yuanjie Semiconductor and Citic Offshore

Assuming the 90 days trading horizon Yuanjie Semiconductor Technology is expected to under-perform the Citic Offshore. But the stock apears to be less risky and, when comparing its historical volatility, Yuanjie Semiconductor Technology is 1.08 times less risky than Citic Offshore. The stock trades about -0.01 of its potential returns per unit of risk. The Citic Offshore Helicopter is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest  2,040  in Citic Offshore Helicopter on October 22, 2024 and sell it today you would earn a total of  309.00  from holding Citic Offshore Helicopter or generate 15.15% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

Yuanjie Semiconductor Technolo  vs.  Citic Offshore Helicopter

Yuanjie Semiconductor

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Yuanjie Semiconductor Technology has generated negative risk-adjusted returns adding no value to investors with long positions. Despite somewhat strong basic indicators, Yuanjie Semiconductor is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Citic Offshore Helicopter

Risk-Adjusted Performance

5 of 100

Insignificant

Compared to the overall equity markets, risk-adjusted returns on investments in Citic Offshore Helicopter are ranked lower than 5 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Citic Offshore sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Yuanjie Semiconductor and Citic Offshore

The main advantage of trading using opposite Yuanjie Semiconductor and Citic Offshore positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuanjie Semiconductor position performs unexpectedly, Citic Offshore 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 Citic Offshore will offset losses from the drop in Citic Offshore's long position.

The idea behind Yuanjie Semiconductor Technology and Citic Offshore Helicopter pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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.