Correlation Between Shunfeng International and DATATEC

Can any of the company-specific risk be diversified away by investing in both Shunfeng International and DATATEC 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 Shunfeng International and DATATEC into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Shunfeng International Clean and DATATEC LTD 2, you can compare the effects of market volatilities on Shunfeng International and DATATEC 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 Shunfeng International with a short position of DATATEC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shunfeng International and DATATEC.

Diversification Opportunities for Shunfeng International and DATATEC

0.0

Correlation Coefficient

Shunfeng International  DATATEC

Pay attention - limited upside

The 3 months correlation between Shunfeng and DATATEC is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Shunfeng International Clean and DATATEC LTD 2 in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DATATEC LTD 2 and Shunfeng International 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 Shunfeng International Clean are associated (or correlated) with DATATEC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DATATEC LTD 2 has no effect on the direction of Shunfeng International i.e., Shunfeng International and DATATEC go up and down completely randomly.

Pair Corralation between Shunfeng International and DATATEC

If you would invest  489.00  in DATATEC LTD 2 on April 24, 2025 and sell it today you would earn a total of  101.00  from holding DATATEC LTD 2 or generate 20.65% return on investment over 90 days.

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

Shunfeng International Clean  vs.  DATATEC LTD 2

Shunfeng International

Risk-Adjusted Performance

Very Weak

Over the last 90 days Shunfeng International Clean has generated negative risk-adjusted returns adding no value to investors with long positions. Despite nearly stable basic indicators, Shunfeng International is not utilizing all of its potentials. The newest stock price disturbance, may contribute to mid-run losses for the stockholders.

DATATEC LTD 2

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in DATATEC LTD 2 are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite nearly fragile basic indicators, DATATEC reported solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Shunfeng International and DATATEC

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

The idea behind Shunfeng International Clean and DATATEC LTD 2 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 Stocks Directory module to find actively traded stocks across global markets.