Correlation Between Changzhou Evergreen and Shandong Polymer
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By analyzing existing cross correlation between Changzhou Evergreen Technology and Shandong Polymer Biochemicals, you can compare the effects of market volatilities on Changzhou Evergreen and Shandong Polymer 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 Changzhou Evergreen with a short position of Shandong Polymer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changzhou Evergreen and Shandong Polymer.
Diversification Opportunities for Changzhou Evergreen and Shandong Polymer
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Changzhou and Shandong is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Changzhou Evergreen Technology and Shandong Polymer Biochemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Polymer Bio and Changzhou Evergreen 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 Changzhou Evergreen Technology are associated (or correlated) with Shandong Polymer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Polymer Bio has no effect on the direction of Changzhou Evergreen i.e., Changzhou Evergreen and Shandong Polymer go up and down completely randomly.
Pair Corralation between Changzhou Evergreen and Shandong Polymer
Assuming the 90 days trading horizon Changzhou Evergreen Technology is expected to generate 1.51 times more return on investment than Shandong Polymer. However, Changzhou Evergreen is 1.51 times more volatile than Shandong Polymer Biochemicals. It trades about 0.08 of its potential returns per unit of risk. Shandong Polymer Biochemicals is currently generating about 0.02 per unit of risk. If you would invest 1,702 in Changzhou Evergreen Technology on November 30, 2024 and sell it today you would earn a total of 113.00 from holding Changzhou Evergreen Technology or generate 6.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changzhou Evergreen Technology vs. Shandong Polymer Biochemicals
Performance |
| Timeline |
| Changzhou Evergreen |
| Shandong Polymer Bio |
Changzhou Evergreen and Shandong Polymer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changzhou Evergreen and Shandong Polymer
The main advantage of trading using opposite Changzhou Evergreen and Shandong Polymer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changzhou Evergreen position performs unexpectedly, Shandong Polymer 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 Shandong Polymer will offset losses from the drop in Shandong Polymer's long position.| Changzhou Evergreen vs. Hua Hong Semiconductor | Changzhou Evergreen vs. Dazhong Transportation Group | Changzhou Evergreen vs. Allied Machinery Co | Changzhou Evergreen vs. Gifore Agricultural Machinery |
| Shandong Polymer vs. Quectel Wireless Solutions | Shandong Polymer vs. China World Trade | Shandong Polymer vs. Allwin Telecommunication Co | Shandong Polymer vs. Fiberhome Telecommunication Technologies |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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