Correlation Between Shenyang Huitian and Qumei Furniture
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By analyzing existing cross correlation between Shenyang Huitian Thermal and Qumei Furniture Group, you can compare the effects of market volatilities on Shenyang Huitian and Qumei Furniture 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 Shenyang Huitian with a short position of Qumei Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenyang Huitian and Qumei Furniture.
Diversification Opportunities for Shenyang Huitian and Qumei Furniture
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shenyang and Qumei is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Shenyang Huitian Thermal and Qumei Furniture Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qumei Furniture Group and Shenyang Huitian 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 Shenyang Huitian Thermal are associated (or correlated) with Qumei Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qumei Furniture Group has no effect on the direction of Shenyang Huitian i.e., Shenyang Huitian and Qumei Furniture go up and down completely randomly.
Pair Corralation between Shenyang Huitian and Qumei Furniture
Assuming the 90 days trading horizon Shenyang Huitian is expected to generate 3.29 times less return on investment than Qumei Furniture. But when comparing it to its historical volatility, Shenyang Huitian Thermal is 1.04 times less risky than Qumei Furniture. It trades about 0.07 of its potential returns per unit of risk. Qumei Furniture Group is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 297.00 in Qumei Furniture Group on September 5, 2024 and sell it today you would earn a total of 39.00 from holding Qumei Furniture Group or generate 13.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Shenyang Huitian Thermal vs. Qumei Furniture Group
Performance |
| Timeline |
| Shenyang Huitian Thermal |
| Qumei Furniture Group |
Shenyang Huitian and Qumei Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenyang Huitian and Qumei Furniture
The main advantage of trading using opposite Shenyang Huitian and Qumei Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenyang Huitian position performs unexpectedly, Qumei Furniture 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 Qumei Furniture will offset losses from the drop in Qumei Furniture's long position.| Shenyang Huitian vs. China Nonferrous Metal | Shenyang Huitian vs. Hefei Metalforming Mach | Shenyang Huitian vs. Zhejiang Yayi Metal | Shenyang Huitian vs. Minmetals Capital Co |
| Qumei Furniture vs. Ningbo Thermal Power | Qumei Furniture vs. Shenyang Huitian Thermal | Qumei Furniture vs. Minmetals Capital Co | Qumei Furniture vs. Beijing HuaYuanYiTong Thermal |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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