Correlation Between Shenwu Energy and Shanxi Lanhua
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By analyzing existing cross correlation between Shenwu Energy Saving and Shanxi Lanhua Sci Tech, you can compare the effects of market volatilities on Shenwu Energy and Shanxi Lanhua 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 Shenwu Energy with a short position of Shanxi Lanhua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenwu Energy and Shanxi Lanhua.
Diversification Opportunities for Shenwu Energy and Shanxi Lanhua
-0.02 | Correlation Coefficient |
Good diversification
The 3 months correlation between Shenwu and Shanxi is -0.02. Overlapping area represents the amount of risk that can be diversified away by holding Shenwu Energy Saving and Shanxi Lanhua Sci Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanxi Lanhua Sci and Shenwu Energy 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 Shenwu Energy Saving are associated (or correlated) with Shanxi Lanhua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanxi Lanhua Sci has no effect on the direction of Shenwu Energy i.e., Shenwu Energy and Shanxi Lanhua go up and down completely randomly.
Pair Corralation between Shenwu Energy and Shanxi Lanhua
Assuming the 90 days trading horizon Shenwu Energy Saving is expected to generate 1.73 times more return on investment than Shanxi Lanhua. However, Shenwu Energy is 1.73 times more volatile than Shanxi Lanhua Sci Tech. It trades about 0.0 of its potential returns per unit of risk. Shanxi Lanhua Sci Tech is currently generating about -0.01 per unit of risk. If you would invest 482.00 in Shenwu Energy Saving on October 14, 2024 and sell it today you would lose (128.00) from holding Shenwu Energy Saving or give up 26.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenwu Energy Saving vs. Shanxi Lanhua Sci Tech
Performance |
| Timeline |
| Shenwu Energy Saving |
| Shanxi Lanhua Sci |
Shenwu Energy and Shanxi Lanhua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenwu Energy and Shanxi Lanhua
The main advantage of trading using opposite Shenwu Energy and Shanxi Lanhua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenwu Energy position performs unexpectedly, Shanxi Lanhua 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 Shanxi Lanhua will offset losses from the drop in Shanxi Lanhua's long position.| Shenwu Energy vs. Shandong Homey Aquatic | Shenwu Energy vs. Tianshan Aluminum Group | Shenwu Energy vs. Rising Nonferrous Metals | Shenwu Energy vs. Zoy Home Furnishing |
| Shanxi Lanhua vs. Unisplendour Corp | Shanxi Lanhua vs. Peoples Insurance of | Shanxi Lanhua vs. Shenwu Energy Saving | Shanxi Lanhua vs. Spring 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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