Correlation Between Shandong and Muyuan Foodstuff
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By analyzing existing cross correlation between Shandong Hi Speed RoadBridge and Muyuan Foodstuff Co, you can compare the effects of market volatilities on Shandong and Muyuan Foodstuff 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 Shandong with a short position of Muyuan Foodstuff. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong and Muyuan Foodstuff.
Diversification Opportunities for Shandong and Muyuan Foodstuff
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shandong and Muyuan is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Hi Speed RoadBridge and Muyuan Foodstuff Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Muyuan Foodstuff and Shandong 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 Shandong Hi Speed RoadBridge are associated (or correlated) with Muyuan Foodstuff. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Muyuan Foodstuff has no effect on the direction of Shandong i.e., Shandong and Muyuan Foodstuff go up and down completely randomly.
Pair Corralation between Shandong and Muyuan Foodstuff
Assuming the 90 days trading horizon Shandong Hi Speed RoadBridge is expected to under-perform the Muyuan Foodstuff. But the stock apears to be less risky and, when comparing its historical volatility, Shandong Hi Speed RoadBridge is 1.02 times less risky than Muyuan Foodstuff. The stock trades about -0.25 of its potential returns per unit of risk. The Muyuan Foodstuff Co is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 3,824 in Muyuan Foodstuff Co on October 23, 2024 and sell it today you would lose (101.00) from holding Muyuan Foodstuff Co or give up 2.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Shandong Hi Speed RoadBridge vs. Muyuan Foodstuff Co
Performance |
| Timeline |
| Shandong Hi Speed |
| Muyuan Foodstuff |
Shandong and Muyuan Foodstuff Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong and Muyuan Foodstuff
The main advantage of trading using opposite Shandong and Muyuan Foodstuff positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong position performs unexpectedly, Muyuan Foodstuff 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 Muyuan Foodstuff will offset losses from the drop in Muyuan Foodstuff's long position.| Shandong vs. Chengdu Kanghua Biological | Shandong vs. Beijing Wantai Biological | Shandong vs. Suzhou Novoprotein Scientific | Shandong vs. Aluminum Corp of |
| Muyuan Foodstuff vs. Zhengping RoadBridge Constr | Muyuan Foodstuff vs. Shandong Hi Speed RoadBridge | Muyuan Foodstuff vs. Bangyan Technology Co | Muyuan Foodstuff vs. Road Environment 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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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