Correlation Between Qingdao Foods and Yingde Greatchem
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By analyzing existing cross correlation between Qingdao Foods Co and Yingde Greatchem Chemicals, you can compare the effects of market volatilities on Qingdao Foods and Yingde Greatchem 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 Qingdao Foods with a short position of Yingde Greatchem. Check out your portfolio center. Please also check ongoing floating volatility patterns of Qingdao Foods and Yingde Greatchem.
Diversification Opportunities for Qingdao Foods and Yingde Greatchem
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Qingdao and Yingde is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Qingdao Foods Co and Yingde Greatchem Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yingde Greatchem Che and Qingdao Foods 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 Qingdao Foods Co are associated (or correlated) with Yingde Greatchem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yingde Greatchem Che has no effect on the direction of Qingdao Foods i.e., Qingdao Foods and Yingde Greatchem go up and down completely randomly.
Pair Corralation between Qingdao Foods and Yingde Greatchem
Assuming the 90 days trading horizon Qingdao Foods Co is expected to under-perform the Yingde Greatchem. In addition to that, Qingdao Foods is 1.06 times more volatile than Yingde Greatchem Chemicals. It trades about -0.49 of its total potential returns per unit of risk. Yingde Greatchem Chemicals is currently generating about -0.23 per unit of volatility. If you would invest 2,615 in Yingde Greatchem Chemicals on October 13, 2024 and sell it today you would lose (304.00) from holding Yingde Greatchem Chemicals or give up 11.63% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Qingdao Foods Co vs. Yingde Greatchem Chemicals
Performance |
| Timeline |
| Qingdao Foods |
| Yingde Greatchem Che |
Qingdao Foods and Yingde Greatchem Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Qingdao Foods and Yingde Greatchem
The main advantage of trading using opposite Qingdao Foods and Yingde Greatchem positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Qingdao Foods position performs unexpectedly, Yingde Greatchem 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 Yingde Greatchem will offset losses from the drop in Yingde Greatchem's long position.| Qingdao Foods vs. Shenyang Chemical Industry | Qingdao Foods vs. Jilin Chemical Fibre | Qingdao Foods vs. Heilongjiang Publishing Media | Qingdao Foods vs. Hainan Airlines Co |
| Yingde Greatchem vs. HaiXin Foods Co | Yingde Greatchem vs. Union Semiconductor Co | Yingde Greatchem vs. Qingdao Foods Co | Yingde Greatchem vs. Shantou Wanshun Package |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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