Correlation Between Shaanxi Energy and Changchun
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By analyzing existing cross correlation between Shaanxi Energy Investment and Changchun UP Optotech, you can compare the effects of market volatilities on Shaanxi Energy and Changchun 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 Shaanxi Energy with a short position of Changchun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shaanxi Energy and Changchun.
Diversification Opportunities for Shaanxi Energy and Changchun
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Shaanxi and Changchun is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Shaanxi Energy Investment and Changchun UP Optotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changchun UP Optotech and Shaanxi 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 Shaanxi Energy Investment are associated (or correlated) with Changchun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changchun UP Optotech has no effect on the direction of Shaanxi Energy i.e., Shaanxi Energy and Changchun go up and down completely randomly.
Pair Corralation between Shaanxi Energy and Changchun
Assuming the 90 days trading horizon Shaanxi Energy Investment is expected to under-perform the Changchun. But the stock apears to be less risky and, when comparing its historical volatility, Shaanxi Energy Investment is 2.93 times less risky than Changchun. The stock trades about -0.18 of its potential returns per unit of risk. The Changchun UP Optotech is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 3,271 in Changchun UP Optotech on October 14, 2024 and sell it today you would earn a total of 317.00 from holding Changchun UP Optotech or generate 9.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shaanxi Energy Investment vs. Changchun UP Optotech
Performance |
| Timeline |
| Shaanxi Energy Investment |
| Changchun UP Optotech |
Shaanxi Energy and Changchun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shaanxi Energy and Changchun
The main advantage of trading using opposite Shaanxi Energy and Changchun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shaanxi Energy position performs unexpectedly, Changchun 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 Changchun will offset losses from the drop in Changchun's long position.| Shaanxi Energy vs. Shuhua Sports Co | Shaanxi Energy vs. Guangzhou KDT Machinery | Shaanxi Energy vs. GUOMAI Culture Media | Shaanxi Energy vs. Sportsoul Co Ltd |
| Changchun vs. Shenyang Blue Silver | Changchun vs. Gem Year Industrial Co | Changchun vs. Qingdao Choho Industrial | Changchun vs. Tonghua Grape Wine |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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