Correlation Between Chengdu Xingrong and Shenyang Chemical
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By analyzing existing cross correlation between Chengdu Xingrong Investment and Shenyang Chemical Industry, you can compare the effects of market volatilities on Chengdu Xingrong and Shenyang Chemical 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 Chengdu Xingrong with a short position of Shenyang Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu Xingrong and Shenyang Chemical.
Diversification Opportunities for Chengdu Xingrong and Shenyang Chemical
-0.05 | Correlation Coefficient |
Good diversification
The 3 months correlation between Chengdu and Shenyang is -0.05. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu Xingrong Investment and Shenyang Chemical Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenyang Chemical and Chengdu Xingrong 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 Chengdu Xingrong Investment are associated (or correlated) with Shenyang Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenyang Chemical has no effect on the direction of Chengdu Xingrong i.e., Chengdu Xingrong and Shenyang Chemical go up and down completely randomly.
Pair Corralation between Chengdu Xingrong and Shenyang Chemical
Assuming the 90 days trading horizon Chengdu Xingrong Investment is expected to under-perform the Shenyang Chemical. But the stock apears to be less risky and, when comparing its historical volatility, Chengdu Xingrong Investment is 1.47 times less risky than Shenyang Chemical. The stock trades about -0.15 of its potential returns per unit of risk. The Shenyang Chemical Industry is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 339.00 in Shenyang Chemical Industry on October 29, 2024 and sell it today you would lose (16.00) from holding Shenyang Chemical Industry or give up 4.72% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.24% |
| Values | Daily Returns |
Chengdu Xingrong Investment vs. Shenyang Chemical Industry
Performance |
| Timeline |
| Chengdu Xingrong Inv |
| Shenyang Chemical |
Chengdu Xingrong and Shenyang Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu Xingrong and Shenyang Chemical
The main advantage of trading using opposite Chengdu Xingrong and Shenyang Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu Xingrong position performs unexpectedly, Shenyang Chemical 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 Shenyang Chemical will offset losses from the drop in Shenyang Chemical's long position.| Chengdu Xingrong vs. Daoming OpticsChemical Co | Chengdu Xingrong vs. Tongling Nonferrous Metals | Chengdu Xingrong vs. Zhejiang Zhengguang Industrial | Chengdu Xingrong vs. Xilong Chemical Co |
| Shenyang Chemical vs. Xiangtan Electrochemical Scientific | Shenyang Chemical vs. Jointo Energy Investment | Shenyang Chemical vs. Cultural Investment Holdings | Shenyang Chemical vs. Xilong Chemical Co |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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