Correlation Between Yuanjie Semiconductor and Shenwan Hongyuan
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By analyzing existing cross correlation between Yuanjie Semiconductor Technology and Shenwan Hongyuan Group, you can compare the effects of market volatilities on Yuanjie Semiconductor and Shenwan Hongyuan 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 Shenwan Hongyuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yuanjie Semiconductor and Shenwan Hongyuan.
Diversification Opportunities for Yuanjie Semiconductor and Shenwan Hongyuan
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Yuanjie and Shenwan is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Yuanjie Semiconductor Technolo and Shenwan Hongyuan Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenwan Hongyuan 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 Shenwan Hongyuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenwan Hongyuan has no effect on the direction of Yuanjie Semiconductor i.e., Yuanjie Semiconductor and Shenwan Hongyuan go up and down completely randomly.
Pair Corralation between Yuanjie Semiconductor and Shenwan Hongyuan
Assuming the 90 days trading horizon Yuanjie Semiconductor Technology is expected to generate 2.7 times more return on investment than Shenwan Hongyuan. However, Yuanjie Semiconductor is 2.7 times more volatile than Shenwan Hongyuan Group. It trades about 0.0 of its potential returns per unit of risk. Shenwan Hongyuan Group is currently generating about -0.1 per unit of risk. If you would invest 13,255 in Yuanjie Semiconductor Technology on December 25, 2024 and sell it today you would lose (706.00) from holding Yuanjie Semiconductor Technology or give up 5.33% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Yuanjie Semiconductor Technolo vs. Shenwan Hongyuan Group
Performance |
Timeline |
Yuanjie Semiconductor |
Shenwan Hongyuan |
Yuanjie Semiconductor and Shenwan Hongyuan Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Yuanjie Semiconductor and Shenwan Hongyuan
The main advantage of trading using opposite Yuanjie Semiconductor and Shenwan Hongyuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yuanjie Semiconductor position performs unexpectedly, Shenwan Hongyuan 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 Shenwan Hongyuan will offset losses from the drop in Shenwan Hongyuan's long position.The idea behind Yuanjie Semiconductor Technology and Shenwan Hongyuan Group 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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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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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