Correlation Between Shenwu Energy and Shanghai Sanyou
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By analyzing existing cross correlation between Shenwu Energy Saving and Shanghai Sanyou Medical, you can compare the effects of market volatilities on Shenwu Energy and Shanghai Sanyou 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 Shanghai Sanyou. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenwu Energy and Shanghai Sanyou.
Diversification Opportunities for Shenwu Energy and Shanghai Sanyou
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shenwu and Shanghai is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Shenwu Energy Saving and Shanghai Sanyou Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Sanyou Medical 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 Shanghai Sanyou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Sanyou Medical has no effect on the direction of Shenwu Energy i.e., Shenwu Energy and Shanghai Sanyou go up and down completely randomly.
Pair Corralation between Shenwu Energy and Shanghai Sanyou
Assuming the 90 days trading horizon Shenwu Energy Saving is expected to generate 1.17 times more return on investment than Shanghai Sanyou. However, Shenwu Energy is 1.17 times more volatile than Shanghai Sanyou Medical. It trades about 0.08 of its potential returns per unit of risk. Shanghai Sanyou Medical is currently generating about 0.07 per unit of risk. If you would invest 416.00 in Shenwu Energy Saving on September 14, 2024 and sell it today you would earn a total of 17.00 from holding Shenwu Energy Saving or generate 4.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenwu Energy Saving vs. Shanghai Sanyou Medical
Performance |
| Timeline |
| Shenwu Energy Saving |
| Shanghai Sanyou Medical |
Shenwu Energy and Shanghai Sanyou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenwu Energy and Shanghai Sanyou
The main advantage of trading using opposite Shenwu Energy and Shanghai Sanyou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenwu Energy position performs unexpectedly, Shanghai Sanyou 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 Shanghai Sanyou will offset losses from the drop in Shanghai Sanyou's long position.| Shenwu Energy vs. Lutian Machinery Co | Shenwu Energy vs. China Longyuan Power | Shenwu Energy vs. PetroChina Co Ltd | Shenwu Energy vs. Bank of China |
| Shanghai Sanyou vs. Industrial and Commercial | Shanghai Sanyou vs. Kweichow Moutai Co | Shanghai Sanyou vs. Agricultural Bank of | Shanghai Sanyou vs. China Mobile Limited |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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