Correlation Between Beijing Shunxin and Sunny Loan
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By analyzing existing cross correlation between Beijing Shunxin Agriculture and Sunny Loan Top, you can compare the effects of market volatilities on Beijing Shunxin and Sunny Loan 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 Beijing Shunxin with a short position of Sunny Loan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Shunxin and Sunny Loan.
Diversification Opportunities for Beijing Shunxin and Sunny Loan
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Beijing and Sunny is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Shunxin Agriculture and Sunny Loan Top in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sunny Loan Top and Beijing Shunxin 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 Beijing Shunxin Agriculture are associated (or correlated) with Sunny Loan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sunny Loan Top has no effect on the direction of Beijing Shunxin i.e., Beijing Shunxin and Sunny Loan go up and down completely randomly.
Pair Corralation between Beijing Shunxin and Sunny Loan
Assuming the 90 days trading horizon Beijing Shunxin Agriculture is expected to generate 0.48 times more return on investment than Sunny Loan. However, Beijing Shunxin Agriculture is 2.07 times less risky than Sunny Loan. It trades about -0.32 of its potential returns per unit of risk. Sunny Loan Top is currently generating about -0.21 per unit of risk. If you would invest 2,008 in Beijing Shunxin Agriculture on October 17, 2024 and sell it today you would lose (284.00) from holding Beijing Shunxin Agriculture or give up 14.14% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Shunxin Agriculture vs. Sunny Loan Top
Performance |
| Timeline |
| Beijing Shunxin Agri |
| Sunny Loan Top |
Beijing Shunxin and Sunny Loan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Shunxin and Sunny Loan
The main advantage of trading using opposite Beijing Shunxin and Sunny Loan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Shunxin position performs unexpectedly, Sunny Loan 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 Sunny Loan will offset losses from the drop in Sunny Loan's long position.| Beijing Shunxin vs. Yunnan Jianzhijia Health Chain | Beijing Shunxin vs. Shandong Sinoglory Health | Beijing Shunxin vs. Hangzhou Minsheng Healthcare | Beijing Shunxin vs. Shenyang Huitian Thermal |
| Sunny Loan vs. Anhui Gujing Distillery | Sunny Loan vs. Beijing Shunxin Agriculture | Sunny Loan vs. Shenyang Huitian Thermal | Sunny Loan vs. Anhui Tongguan Copper |
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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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