Correlation Between Shaanxi Meineng and Shanghai Laimu
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By analyzing existing cross correlation between Shaanxi Meineng Clean and Shanghai Laimu Electronics, you can compare the effects of market volatilities on Shaanxi Meineng and Shanghai Laimu 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 Shanghai Laimu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shaanxi Meineng and Shanghai Laimu.
Diversification Opportunities for Shaanxi Meineng and Shanghai Laimu
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Shaanxi and Shanghai is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Shaanxi Meineng Clean and Shanghai Laimu Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Laimu Elect 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 Shanghai Laimu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Laimu Elect has no effect on the direction of Shaanxi Meineng i.e., Shaanxi Meineng and Shanghai Laimu go up and down completely randomly.
Pair Corralation between Shaanxi Meineng and Shanghai Laimu
Assuming the 90 days trading horizon Shaanxi Meineng is expected to generate 1.31 times less return on investment than Shanghai Laimu. But when comparing it to its historical volatility, Shaanxi Meineng Clean is 2.18 times less risky than Shanghai Laimu. It trades about 0.06 of its potential returns per unit of risk. Shanghai Laimu Electronics is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 783.00 in Shanghai Laimu Electronics on November 3, 2024 and sell it today you would earn a total of 9.00 from holding Shanghai Laimu Electronics or generate 1.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shaanxi Meineng Clean vs. Shanghai Laimu Electronics
Performance |
| Timeline |
| Shaanxi Meineng Clean |
| Shanghai Laimu Elect |
Shaanxi Meineng and Shanghai Laimu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shaanxi Meineng and Shanghai Laimu
The main advantage of trading using opposite Shaanxi Meineng and Shanghai Laimu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shaanxi Meineng position performs unexpectedly, Shanghai Laimu 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 Laimu will offset losses from the drop in Shanghai Laimu's long position.| Shaanxi Meineng vs. Bomesc Offshore Engineering | Shaanxi Meineng vs. Anhui Huaheng Biotechnology | Shaanxi Meineng vs. Duzhe Publishing Media | Shaanxi Meineng vs. Sichuan Hebang Biotechnology |
| Shanghai Laimu vs. Hefei Metalforming Mach | Shanghai Laimu vs. Ye Chiu Metal | Shanghai Laimu vs. Jiajia Food Group | Shanghai Laimu vs. Shandong Hongchuang Aluminum |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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