Correlation Between Shenzhen Centralcon and China Railway
Specify exactly 2 symbols:
By analyzing existing cross correlation between Shenzhen Centralcon Investment and China Railway Materials, you can compare the effects of market volatilities on Shenzhen Centralcon and China Railway 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 Centralcon with a short position of China Railway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Centralcon and China Railway.
Diversification Opportunities for Shenzhen Centralcon and China Railway
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shenzhen and China is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Centralcon Investment and China Railway Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Railway Materials and Shenzhen Centralcon 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 Centralcon Investment are associated (or correlated) with China Railway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Railway Materials has no effect on the direction of Shenzhen Centralcon i.e., Shenzhen Centralcon and China Railway go up and down completely randomly.
Pair Corralation between Shenzhen Centralcon and China Railway
Assuming the 90 days trading horizon Shenzhen Centralcon Investment is expected to under-perform the China Railway. In addition to that, Shenzhen Centralcon is 1.9 times more volatile than China Railway Materials. It trades about -0.02 of its total potential returns per unit of risk. China Railway Materials is currently generating about 0.01 per unit of volatility. If you would invest 300.00 in China Railway Materials on September 5, 2024 and sell it today you would lose (6.00) from holding China Railway Materials or give up 2.0% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 99.79% |
| Values | Daily Returns |
Shenzhen Centralcon Investment vs. China Railway Materials
Performance |
| Timeline |
| Shenzhen Centralcon |
| China Railway Materials |
Shenzhen Centralcon and China Railway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Centralcon and China Railway
The main advantage of trading using opposite Shenzhen Centralcon and China Railway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Centralcon position performs unexpectedly, China Railway 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 China Railway will offset losses from the drop in China Railway's long position.The idea behind Shenzhen Centralcon Investment and China Railway Materials 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.
| China Railway vs. Sinosteel Engineering and | China Railway vs. Xiamen Jihong Package | China Railway vs. Youyou Foods Co | China Railway vs. Aofu Environmental Technology |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
Other Complementary Tools
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Price Transformation Use Price Transformation models to analyze the depth of different equity instruments across global markets | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Volatility Analysis Get historical volatility and risk analysis based on latest market data |