Correlation Between Shaanxi Meineng and Shenyang Huitian
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By analyzing existing cross correlation between Shaanxi Meineng Clean and Shenyang Huitian Thermal, you can compare the effects of market volatilities on Shaanxi Meineng and Shenyang Huitian 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 Meineng with a short position of Shenyang Huitian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shaanxi Meineng and Shenyang Huitian.
Diversification Opportunities for Shaanxi Meineng and Shenyang Huitian
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shaanxi and Shenyang is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Shaanxi Meineng Clean and Shenyang Huitian Thermal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenyang Huitian Thermal and Shaanxi Meineng 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 Meineng Clean are associated (or correlated) with Shenyang Huitian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenyang Huitian Thermal has no effect on the direction of Shaanxi Meineng i.e., Shaanxi Meineng and Shenyang Huitian go up and down completely randomly.
Pair Corralation between Shaanxi Meineng and Shenyang Huitian
Assuming the 90 days trading horizon Shaanxi Meineng Clean is expected to generate 0.98 times more return on investment than Shenyang Huitian. However, Shaanxi Meineng Clean is 1.02 times less risky than Shenyang Huitian. It trades about 0.12 of its potential returns per unit of risk. Shenyang Huitian Thermal is currently generating about 0.03 per unit of risk. If you would invest 1,212 in Shaanxi Meineng Clean on November 5, 2024 and sell it today you would earn a total of 43.00 from holding Shaanxi Meineng Clean or generate 3.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shaanxi Meineng Clean vs. Shenyang Huitian Thermal
Performance |
| Timeline |
| Shaanxi Meineng Clean |
| Shenyang Huitian Thermal |
Shaanxi Meineng and Shenyang Huitian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shaanxi Meineng and Shenyang Huitian
The main advantage of trading using opposite Shaanxi Meineng and Shenyang Huitian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shaanxi Meineng position performs unexpectedly, Shenyang Huitian 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 Shenyang Huitian will offset losses from the drop in Shenyang Huitian's long position.| Shaanxi Meineng vs. Agricultural Bank of | Shaanxi Meineng vs. Industrial and Commercial | Shaanxi Meineng vs. Bank of China | Shaanxi Meineng vs. China Construction Bank |
| Shenyang Huitian vs. Liaoning Dingjide Petrochemical | Shenyang Huitian vs. Suzhou Weizhixiang Food | Shenyang Huitian vs. New Hope Dairy | Shenyang Huitian vs. Huatian Hotel 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 Global Correlations module to find global opportunities by holding instruments from different markets.
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