Correlation Between Shanghai Metersbonwe and Xinjiang Communications
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By analyzing existing cross correlation between Shanghai Metersbonwe FashionAccessories and Xinjiang Communications Construction, you can compare the effects of market volatilities on Shanghai Metersbonwe and Xinjiang Communications 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 Shanghai Metersbonwe with a short position of Xinjiang Communications. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Metersbonwe and Xinjiang Communications.
Diversification Opportunities for Shanghai Metersbonwe and Xinjiang Communications
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shanghai and Xinjiang is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Metersbonwe FashionAc and Xinjiang Communications Constr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinjiang Communications and Shanghai Metersbonwe 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 Shanghai Metersbonwe FashionAccessories are associated (or correlated) with Xinjiang Communications. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinjiang Communications has no effect on the direction of Shanghai Metersbonwe i.e., Shanghai Metersbonwe and Xinjiang Communications go up and down completely randomly.
Pair Corralation between Shanghai Metersbonwe and Xinjiang Communications
Assuming the 90 days trading horizon Shanghai Metersbonwe FashionAccessories is expected to generate 1.07 times more return on investment than Xinjiang Communications. However, Shanghai Metersbonwe is 1.07 times more volatile than Xinjiang Communications Construction. It trades about 0.03 of its potential returns per unit of risk. Xinjiang Communications Construction is currently generating about 0.0 per unit of risk. If you would invest 163.00 in Shanghai Metersbonwe FashionAccessories on September 3, 2024 and sell it today you would earn a total of 39.00 from holding Shanghai Metersbonwe FashionAccessories or generate 23.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Metersbonwe FashionAc vs. Xinjiang Communications Constr
Performance |
| Timeline |
| Shanghai Metersbonwe |
| Xinjiang Communications |
Shanghai Metersbonwe and Xinjiang Communications Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Metersbonwe and Xinjiang Communications
The main advantage of trading using opposite Shanghai Metersbonwe and Xinjiang Communications positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Metersbonwe position performs unexpectedly, Xinjiang Communications 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 Xinjiang Communications will offset losses from the drop in Xinjiang Communications' long position.| Shanghai Metersbonwe vs. PetroChina Co Ltd | Shanghai Metersbonwe vs. China Mobile Limited | Shanghai Metersbonwe vs. Industrial and Commercial | Shanghai Metersbonwe vs. China Life Insurance |
| Xinjiang Communications vs. Cultural Investment Holdings | Xinjiang Communications vs. Gome Telecom Equipment | Xinjiang Communications vs. Bus Online Co | Xinjiang Communications vs. Holitech Technology 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 Global Correlations module to find global opportunities by holding instruments from different markets.
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