Correlation Between Leaguer Shenzhen and Guangdong Jingyi
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By analyzing existing cross correlation between Leaguer Shenzhen MicroElectronics and Guangdong Jingyi Metal, you can compare the effects of market volatilities on Leaguer Shenzhen and Guangdong Jingyi 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 Leaguer Shenzhen with a short position of Guangdong Jingyi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Leaguer Shenzhen and Guangdong Jingyi.
Diversification Opportunities for Leaguer Shenzhen and Guangdong Jingyi
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Leaguer and Guangdong is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Leaguer Shenzhen MicroElectron and Guangdong Jingyi Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Jingyi Metal and Leaguer Shenzhen 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 Leaguer Shenzhen MicroElectronics are associated (or correlated) with Guangdong Jingyi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Jingyi Metal has no effect on the direction of Leaguer Shenzhen i.e., Leaguer Shenzhen and Guangdong Jingyi go up and down completely randomly.
Pair Corralation between Leaguer Shenzhen and Guangdong Jingyi
Assuming the 90 days trading horizon Leaguer Shenzhen MicroElectronics is expected to generate 1.12 times more return on investment than Guangdong Jingyi. However, Leaguer Shenzhen is 1.12 times more volatile than Guangdong Jingyi Metal. It trades about 0.19 of its potential returns per unit of risk. Guangdong Jingyi Metal is currently generating about 0.17 per unit of risk. If you would invest 2,744 in Leaguer Shenzhen MicroElectronics on September 24, 2024 and sell it today you would earn a total of 206.00 from holding Leaguer Shenzhen MicroElectronics or generate 7.51% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Leaguer Shenzhen MicroElectron vs. Guangdong Jingyi Metal
Performance |
Timeline |
Leaguer Shenzhen Mic |
Guangdong Jingyi Metal |
Leaguer Shenzhen and Guangdong Jingyi Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Leaguer Shenzhen and Guangdong Jingyi
The main advantage of trading using opposite Leaguer Shenzhen and Guangdong Jingyi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Leaguer Shenzhen position performs unexpectedly, Guangdong Jingyi 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 Guangdong Jingyi will offset losses from the drop in Guangdong Jingyi's long position.Leaguer Shenzhen vs. Gansu Yasheng Industrial | Leaguer Shenzhen vs. Linewell Software Co | Leaguer Shenzhen vs. China Nonferrous Metal | Leaguer Shenzhen vs. Servyou Software Group |
Guangdong Jingyi vs. TongFu Microelectronics Co | Guangdong Jingyi vs. Qingdao Foods Co | Guangdong Jingyi vs. Unigroup Guoxin Microelectronics | Guangdong Jingyi vs. Leaguer Shenzhen MicroElectronics |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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