Correlation Between Shenzhen Noposion and Epoxy Base
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By analyzing existing cross correlation between Shenzhen Noposion Agrochemicals and Epoxy Base Electronic, you can compare the effects of market volatilities on Shenzhen Noposion and Epoxy Base 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 Epoxy Base. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Noposion and Epoxy Base.
Diversification Opportunities for Shenzhen Noposion and Epoxy Base
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shenzhen and Epoxy is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Noposion Agrochemical and Epoxy Base Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Epoxy Base Electronic 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 Epoxy Base. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Epoxy Base Electronic has no effect on the direction of Shenzhen Noposion i.e., Shenzhen Noposion and Epoxy Base go up and down completely randomly.
Pair Corralation between Shenzhen Noposion and Epoxy Base
Assuming the 90 days trading horizon Shenzhen Noposion Agrochemicals is expected to generate 0.68 times more return on investment than Epoxy Base. However, Shenzhen Noposion Agrochemicals is 1.47 times less risky than Epoxy Base. It trades about 0.05 of its potential returns per unit of risk. Epoxy Base Electronic is currently generating about 0.02 per unit of risk. If you would invest 737.00 in Shenzhen Noposion Agrochemicals on August 26, 2024 and sell it today you would earn a total of 212.00 from holding Shenzhen Noposion Agrochemicals or generate 28.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Noposion Agrochemical vs. Epoxy Base Electronic
Performance |
| Timeline |
| Shenzhen Noposion |
| Epoxy Base Electronic |
Shenzhen Noposion and Epoxy Base Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Noposion and Epoxy Base
The main advantage of trading using opposite Shenzhen Noposion and Epoxy Base positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Noposion position performs unexpectedly, Epoxy Base 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 Epoxy Base will offset losses from the drop in Epoxy Base'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 |
| Epoxy Base vs. Zijin Mining Group | Epoxy Base vs. Wanhua Chemical Group | Epoxy Base vs. Baoshan Iron Steel | Epoxy Base vs. Shandong Gold Mining |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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