Correlation Between Shenyang Chemical and Qingdao Foods
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By analyzing existing cross correlation between Shenyang Chemical Industry and Qingdao Foods Co, you can compare the effects of market volatilities on Shenyang Chemical and Qingdao Foods 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 Chemical with a short position of Qingdao Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenyang Chemical and Qingdao Foods.
Diversification Opportunities for Shenyang Chemical and Qingdao Foods
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shenyang and Qingdao is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Shenyang Chemical Industry and Qingdao Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qingdao Foods and Shenyang Chemical 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 Chemical Industry are associated (or correlated) with Qingdao Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qingdao Foods has no effect on the direction of Shenyang Chemical i.e., Shenyang Chemical and Qingdao Foods go up and down completely randomly.
Pair Corralation between Shenyang Chemical and Qingdao Foods
Assuming the 90 days trading horizon Shenyang Chemical Industry is expected to generate 1.36 times more return on investment than Qingdao Foods. However, Shenyang Chemical is 1.36 times more volatile than Qingdao Foods Co. It trades about -0.21 of its potential returns per unit of risk. Qingdao Foods Co is currently generating about -0.28 per unit of risk. If you would invest 390.00 in Shenyang Chemical Industry on October 12, 2024 and sell it today you would lose (65.00) from holding Shenyang Chemical Industry or give up 16.67% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.45% |
| Values | Daily Returns |
Shenyang Chemical Industry vs. Qingdao Foods Co
Performance |
| Timeline |
| Shenyang Chemical |
| Qingdao Foods |
Shenyang Chemical and Qingdao Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenyang Chemical and Qingdao Foods
The main advantage of trading using opposite Shenyang Chemical and Qingdao Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenyang Chemical position performs unexpectedly, Qingdao Foods 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 Qingdao Foods will offset losses from the drop in Qingdao Foods' long position.| Shenyang Chemical vs. Zijin Mining Group | Shenyang Chemical vs. Wanhua Chemical Group | Shenyang Chemical vs. Baoshan Iron Steel | Shenyang Chemical vs. Shandong Gold Mining |
| Qingdao Foods vs. Shenyang Chemical Industry | Qingdao Foods vs. Jilin Chemical Fibre | Qingdao Foods vs. Heilongjiang Publishing Media | Qingdao Foods vs. Hainan Airlines 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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