Correlation Between China Merchants and Shenzhen Bioeasy
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By analyzing existing cross correlation between China Merchants Shekou and Shenzhen Bioeasy Biotechnology, you can compare the effects of market volatilities on China Merchants and Shenzhen Bioeasy 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 China Merchants with a short position of Shenzhen Bioeasy. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Merchants and Shenzhen Bioeasy.
Diversification Opportunities for China Merchants and Shenzhen Bioeasy
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Shenzhen is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding China Merchants Shekou and Shenzhen Bioeasy Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Bioeasy Bio and China Merchants 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 China Merchants Shekou are associated (or correlated) with Shenzhen Bioeasy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Bioeasy Bio has no effect on the direction of China Merchants i.e., China Merchants and Shenzhen Bioeasy go up and down completely randomly.
Pair Corralation between China Merchants and Shenzhen Bioeasy
Assuming the 90 days trading horizon China Merchants Shekou is expected to under-perform the Shenzhen Bioeasy. But the stock apears to be less risky and, when comparing its historical volatility, China Merchants Shekou is 2.04 times less risky than Shenzhen Bioeasy. The stock trades about 0.0 of its potential returns per unit of risk. The Shenzhen Bioeasy Biotechnology is currently generating about 0.17 of returns per unit of risk over similar time horizon. If you would invest 888.00 in Shenzhen Bioeasy Biotechnology on August 29, 2024 and sell it today you would earn a total of 167.00 from holding Shenzhen Bioeasy Biotechnology or generate 18.81% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Merchants Shekou vs. Shenzhen Bioeasy Biotechnology
Performance |
| Timeline |
| China Merchants Shekou |
| Shenzhen Bioeasy Bio |
China Merchants and Shenzhen Bioeasy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Merchants and Shenzhen Bioeasy
The main advantage of trading using opposite China Merchants and Shenzhen Bioeasy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Merchants position performs unexpectedly, Shenzhen Bioeasy 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 Shenzhen Bioeasy will offset losses from the drop in Shenzhen Bioeasy's long position.| China Merchants vs. China Nonferrous Metal | China Merchants vs. Jinhe Biotechnology Co | China Merchants vs. Zhejiang Yayi Metal | China Merchants vs. Gansu Yasheng Industrial |
| Shenzhen Bioeasy vs. Industrial and Commercial | Shenzhen Bioeasy vs. China Construction Bank | Shenzhen Bioeasy vs. Agricultural Bank of | Shenzhen Bioeasy vs. Bank of China |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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