Correlation Between Shenzhen MYS and Olympic Circuit
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By analyzing existing cross correlation between Shenzhen MYS Environmental and Olympic Circuit Technology, you can compare the effects of market volatilities on Shenzhen MYS and Olympic Circuit 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 Shenzhen MYS with a short position of Olympic Circuit. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen MYS and Olympic Circuit.
Diversification Opportunities for Shenzhen MYS and Olympic Circuit
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shenzhen and Olympic is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen MYS Environmental and Olympic Circuit Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Olympic Circuit Tech and Shenzhen MYS 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 Shenzhen MYS Environmental are associated (or correlated) with Olympic Circuit. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Olympic Circuit Tech has no effect on the direction of Shenzhen MYS i.e., Shenzhen MYS and Olympic Circuit go up and down completely randomly.
Pair Corralation between Shenzhen MYS and Olympic Circuit
Assuming the 90 days trading horizon Shenzhen MYS Environmental is expected to generate 0.75 times more return on investment than Olympic Circuit. However, Shenzhen MYS Environmental is 1.34 times less risky than Olympic Circuit. It trades about 0.22 of its potential returns per unit of risk. Olympic Circuit Technology is currently generating about 0.16 per unit of risk. If you would invest 242.00 in Shenzhen MYS Environmental on September 6, 2024 and sell it today you would earn a total of 131.00 from holding Shenzhen MYS Environmental or generate 54.13% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Shenzhen MYS Environmental vs. Olympic Circuit Technology
Performance |
Timeline |
Shenzhen MYS Environ |
Olympic Circuit Tech |
Shenzhen MYS and Olympic Circuit Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Shenzhen MYS and Olympic Circuit
The main advantage of trading using opposite Shenzhen MYS and Olympic Circuit positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen MYS position performs unexpectedly, Olympic Circuit 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 Olympic Circuit will offset losses from the drop in Olympic Circuit's long position.Shenzhen MYS vs. Rising Nonferrous Metals | Shenzhen MYS vs. Western Metal Materials | Shenzhen MYS vs. HeNan Splendor Science | Shenzhen MYS vs. Ye Chiu Metal |
Olympic Circuit vs. PetroChina Co Ltd | Olympic Circuit vs. China Mobile Limited | Olympic Circuit vs. CNOOC Limited | Olympic Circuit vs. Ping An Insurance |
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