Correlation Between China Merchants and Shanghai Yanpu
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By analyzing existing cross correlation between China Merchants Shekou and Shanghai Yanpu Metal, you can compare the effects of market volatilities on China Merchants and Shanghai Yanpu 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 Shanghai Yanpu. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Merchants and Shanghai Yanpu.
Diversification Opportunities for China Merchants and Shanghai Yanpu
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Shanghai is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding China Merchants Shekou and Shanghai Yanpu Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Yanpu Metal 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 Shanghai Yanpu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Yanpu Metal has no effect on the direction of China Merchants i.e., China Merchants and Shanghai Yanpu go up and down completely randomly.
Pair Corralation between China Merchants and Shanghai Yanpu
Assuming the 90 days trading horizon China Merchants is expected to generate 1.62 times less return on investment than Shanghai Yanpu. In addition to that, China Merchants is 1.03 times more volatile than Shanghai Yanpu Metal. It trades about 0.07 of its total potential returns per unit of risk. Shanghai Yanpu Metal is currently generating about 0.11 per unit of volatility. If you would invest 2,855 in Shanghai Yanpu Metal on September 2, 2024 and sell it today you would earn a total of 1,183 from holding Shanghai Yanpu Metal or generate 41.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Merchants Shekou vs. Shanghai Yanpu Metal
Performance |
| Timeline |
| China Merchants Shekou |
| Shanghai Yanpu Metal |
China Merchants and Shanghai Yanpu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Merchants and Shanghai Yanpu
The main advantage of trading using opposite China Merchants and Shanghai Yanpu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Merchants position performs unexpectedly, Shanghai Yanpu 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 Yanpu will offset losses from the drop in Shanghai Yanpu's long position.| China Merchants vs. ChengDu Hi Tech Development | China Merchants vs. FSPG Hi Tech Co | China Merchants vs. Sunwave Communications Co | China Merchants vs. Zhejiang JIULI Hi tech |
| Shanghai Yanpu vs. Beijing Jiaman Dress | Shanghai Yanpu vs. Guangdong Shenglu Telecommunication | Shanghai Yanpu vs. Hangzhou Pinming Software | Shanghai Yanpu vs. Sunwave Communications Co |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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