Correlation Between Shenzhen Agricultural and PharmaResources
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By analyzing existing cross correlation between Shenzhen Agricultural Products and PharmaResources Co Ltd, you can compare the effects of market volatilities on Shenzhen Agricultural and PharmaResources 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 Agricultural with a short position of PharmaResources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Agricultural and PharmaResources.
Diversification Opportunities for Shenzhen Agricultural and PharmaResources
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shenzhen and PharmaResources is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Agricultural Products and PharmaResources Co Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PharmaResources and Shenzhen Agricultural 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 Agricultural Products are associated (or correlated) with PharmaResources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PharmaResources has no effect on the direction of Shenzhen Agricultural i.e., Shenzhen Agricultural and PharmaResources go up and down completely randomly.
Pair Corralation between Shenzhen Agricultural and PharmaResources
Assuming the 90 days trading horizon Shenzhen Agricultural is expected to generate 1.01 times less return on investment than PharmaResources. But when comparing it to its historical volatility, Shenzhen Agricultural Products is 2.5 times less risky than PharmaResources. It trades about 0.05 of its potential returns per unit of risk. PharmaResources Co Ltd is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 2,794 in PharmaResources Co Ltd on September 19, 2024 and sell it today you would lose (94.00) from holding PharmaResources Co Ltd or give up 3.36% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Agricultural Products vs. PharmaResources Co Ltd
Performance |
| Timeline |
| Shenzhen Agricultural |
| PharmaResources |
Shenzhen Agricultural and PharmaResources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Agricultural and PharmaResources
The main advantage of trading using opposite Shenzhen Agricultural and PharmaResources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Agricultural position performs unexpectedly, PharmaResources 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 PharmaResources will offset losses from the drop in PharmaResources' long position.| Shenzhen Agricultural vs. Ming Yang Smart | Shenzhen Agricultural vs. 159681 | Shenzhen Agricultural vs. 159005 | Shenzhen Agricultural vs. Loctek Ergonomic Technology |
| PharmaResources vs. Industrial and Commercial | PharmaResources vs. China Construction Bank | PharmaResources vs. Bank of China | PharmaResources vs. Agricultural Bank of |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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