Correlation Between Aerospace and Shanghai Shuixing
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By analyzing existing cross correlation between Aerospace Hi Tech Holding and Shanghai Shuixing Home, you can compare the effects of market volatilities on Aerospace and Shanghai Shuixing 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 Aerospace with a short position of Shanghai Shuixing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aerospace and Shanghai Shuixing.
Diversification Opportunities for Aerospace and Shanghai Shuixing
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Aerospace and Shanghai is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Aerospace Hi Tech Holding and Shanghai Shuixing Home in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Shuixing Home and Aerospace 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 Aerospace Hi Tech Holding are associated (or correlated) with Shanghai Shuixing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Shuixing Home has no effect on the direction of Aerospace i.e., Aerospace and Shanghai Shuixing go up and down completely randomly.
Pair Corralation between Aerospace and Shanghai Shuixing
Assuming the 90 days trading horizon Aerospace Hi Tech Holding is expected to under-perform the Shanghai Shuixing. But the stock apears to be less risky and, when comparing its historical volatility, Aerospace Hi Tech Holding is 1.79 times less risky than Shanghai Shuixing. The stock trades about -0.09 of its potential returns per unit of risk. The Shanghai Shuixing Home is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 1,660 in Shanghai Shuixing Home on September 28, 2024 and sell it today you would lose (30.00) from holding Shanghai Shuixing Home or give up 1.81% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aerospace Hi Tech Holding vs. Shanghai Shuixing Home
Performance |
| Timeline |
| Aerospace Hi Tech |
| Shanghai Shuixing Home |
Aerospace and Shanghai Shuixing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aerospace and Shanghai Shuixing
The main advantage of trading using opposite Aerospace and Shanghai Shuixing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aerospace position performs unexpectedly, Shanghai Shuixing 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 Shuixing will offset losses from the drop in Shanghai Shuixing's long position.| Aerospace vs. China Life Insurance | Aerospace vs. Cinda Securities Co | Aerospace vs. Piotech Inc A | Aerospace vs. Dongxing Sec Co |
| Shanghai Shuixing vs. Cambricon Technologies Corp | Shanghai Shuixing vs. Loongson Technology Corp | Shanghai Shuixing vs. Shenzhen Fortune Trend | Shanghai Shuixing vs. Chongqing Road Bridge |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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