Correlation Between City Development and Shanghai CEO
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By analyzing existing cross correlation between City Development Environment and Shanghai CEO Environmental, you can compare the effects of market volatilities on City Development and Shanghai CEO 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 City Development with a short position of Shanghai CEO. Check out your portfolio center. Please also check ongoing floating volatility patterns of City Development and Shanghai CEO.
Diversification Opportunities for City Development and Shanghai CEO
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between City and Shanghai is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding City Development Environment and Shanghai CEO Environmental in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai CEO Environ and City Development 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 City Development Environment are associated (or correlated) with Shanghai CEO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai CEO Environ has no effect on the direction of City Development i.e., City Development and Shanghai CEO go up and down completely randomly.
Pair Corralation between City Development and Shanghai CEO
Assuming the 90 days trading horizon City Development is expected to generate 26.39 times less return on investment than Shanghai CEO. But when comparing it to its historical volatility, City Development Environment is 22.58 times less risky than Shanghai CEO. It trades about 0.03 of its potential returns per unit of risk. Shanghai CEO Environmental is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 2,353 in Shanghai CEO Environmental on October 29, 2024 and sell it today you would lose (1,486) from holding Shanghai CEO Environmental or give up 63.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
City Development Environment vs. Shanghai CEO Environmental
Performance |
| Timeline |
| City Development Env |
| Shanghai CEO Environ |
City Development and Shanghai CEO Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with City Development and Shanghai CEO
The main advantage of trading using opposite City Development and Shanghai CEO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if City Development position performs unexpectedly, Shanghai CEO 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 CEO will offset losses from the drop in Shanghai CEO's long position.| City Development vs. China Aluminum International | City Development vs. Zhejiang Yongjin Metal | City Development vs. AVIC Fund Management | City Development vs. Cicc Fund Management |
| Shanghai CEO vs. China Petroleum Chemical | Shanghai CEO vs. PetroChina Co Ltd | Shanghai CEO vs. China State Construction | Shanghai CEO vs. China Railway Group |
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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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