Correlation Between Shenzhen Noposion and Shenyang Chemical
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By analyzing existing cross correlation between Shenzhen Noposion Agrochemicals and Shenyang Chemical Industry, you can compare the effects of market volatilities on Shenzhen Noposion and Shenyang Chemical 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 Shenzhen Noposion with a short position of Shenyang Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Noposion and Shenyang Chemical.
Diversification Opportunities for Shenzhen Noposion and Shenyang Chemical
0.25 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Shenzhen and Shenyang is 0.25. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Noposion Agrochemical and Shenyang Chemical Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenyang Chemical and Shenzhen Noposion 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 Shenzhen Noposion Agrochemicals are associated (or correlated) with Shenyang Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenyang Chemical has no effect on the direction of Shenzhen Noposion i.e., Shenzhen Noposion and Shenyang Chemical go up and down completely randomly.
Pair Corralation between Shenzhen Noposion and Shenyang Chemical
Assuming the 90 days trading horizon Shenzhen Noposion Agrochemicals is expected to generate 0.97 times more return on investment than Shenyang Chemical. However, Shenzhen Noposion Agrochemicals is 1.03 times less risky than Shenyang Chemical. It trades about 0.04 of its potential returns per unit of risk. Shenyang Chemical Industry is currently generating about -0.02 per unit of risk. If you would invest 669.00 in Shenzhen Noposion Agrochemicals on November 2, 2024 and sell it today you would earn a total of 318.00 from holding Shenzhen Noposion Agrochemicals or generate 47.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Noposion Agrochemical vs. Shenyang Chemical Industry
Performance |
| Timeline |
| Shenzhen Noposion |
| Shenyang Chemical |
Shenzhen Noposion and Shenyang Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Noposion and Shenyang Chemical
The main advantage of trading using opposite Shenzhen Noposion and Shenyang Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Noposion position performs unexpectedly, Shenyang Chemical 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 Shenyang Chemical will offset losses from the drop in Shenyang Chemical's long position.| Shenzhen Noposion vs. Zijin Mining Group | Shenzhen Noposion vs. Wanhua Chemical Group | Shenzhen Noposion vs. Baoshan Iron Steel | Shenzhen Noposion vs. Shandong Gold Mining |
| Shenyang Chemical vs. Fibocom Wireless | Shenyang Chemical vs. Runjian Communication Co | Shenyang Chemical vs. Guangdong Jinma Entertainment | Shenyang Chemical 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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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