Correlation Between Hongrun Construction and Shanghai Pudong
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By analyzing existing cross correlation between Hongrun Construction Group and Shanghai Pudong Development, you can compare the effects of market volatilities on Hongrun Construction and Shanghai Pudong 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 Hongrun Construction with a short position of Shanghai Pudong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hongrun Construction and Shanghai Pudong.
Diversification Opportunities for Hongrun Construction and Shanghai Pudong
-0.14 | Correlation Coefficient |
Good diversification
The 3 months correlation between Hongrun and Shanghai is -0.14. Overlapping area represents the amount of risk that can be diversified away by holding Hongrun Construction Group and Shanghai Pudong Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Pudong Deve and Hongrun Construction 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 Hongrun Construction Group are associated (or correlated) with Shanghai Pudong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Pudong Deve has no effect on the direction of Hongrun Construction i.e., Hongrun Construction and Shanghai Pudong go up and down completely randomly.
Pair Corralation between Hongrun Construction and Shanghai Pudong
Assuming the 90 days trading horizon Hongrun Construction Group is expected to generate 2.2 times more return on investment than Shanghai Pudong. However, Hongrun Construction is 2.2 times more volatile than Shanghai Pudong Development. It trades about 0.13 of its potential returns per unit of risk. Shanghai Pudong Development is currently generating about 0.13 per unit of risk. If you would invest 481.00 in Hongrun Construction Group on October 11, 2024 and sell it today you would earn a total of 39.00 from holding Hongrun Construction Group or generate 8.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hongrun Construction Group vs. Shanghai Pudong Development
Performance |
| Timeline |
| Hongrun Construction |
| Shanghai Pudong Deve |
Hongrun Construction and Shanghai Pudong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hongrun Construction and Shanghai Pudong
The main advantage of trading using opposite Hongrun Construction and Shanghai Pudong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hongrun Construction position performs unexpectedly, Shanghai Pudong 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 Pudong will offset losses from the drop in Shanghai Pudong's long position.| Hongrun Construction vs. Aba Chemicals Corp | Hongrun Construction vs. Hunan TV Broadcast | Hongrun Construction vs. Zhongshan Broad Ocean Motor | Hongrun Construction vs. Chongqing Road Bridge |
| Shanghai Pudong vs. Zhengzhou Coal Mining | Shanghai Pudong vs. Masterwork Machinery | Shanghai Pudong vs. Qijing Machinery | Shanghai Pudong vs. Hongrun Construction 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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