Correlation Between Shanghai Metersbonwe and Shenzhen Mindray
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By analyzing existing cross correlation between Shanghai Metersbonwe FashionAccessories and Shenzhen Mindray Bio Medical, you can compare the effects of market volatilities on Shanghai Metersbonwe and Shenzhen Mindray 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 Shenzhen Mindray. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Metersbonwe and Shenzhen Mindray.
Diversification Opportunities for Shanghai Metersbonwe and Shenzhen Mindray
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shanghai and Shenzhen is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Metersbonwe FashionAc and Shenzhen Mindray Bio Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Mindray Bio 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 Shenzhen Mindray. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Mindray Bio has no effect on the direction of Shanghai Metersbonwe i.e., Shanghai Metersbonwe and Shenzhen Mindray go up and down completely randomly.
Pair Corralation between Shanghai Metersbonwe and Shenzhen Mindray
Assuming the 90 days trading horizon Shanghai Metersbonwe FashionAccessories is expected to generate 1.41 times more return on investment than Shenzhen Mindray. However, Shanghai Metersbonwe is 1.41 times more volatile than Shenzhen Mindray Bio Medical. It trades about 0.03 of its potential returns per unit of risk. Shenzhen Mindray Bio Medical is currently generating about 0.0 per unit of risk. If you would invest 188.00 in Shanghai Metersbonwe FashionAccessories on September 2, 2024 and sell it today you would earn a total of 14.00 from holding Shanghai Metersbonwe FashionAccessories or generate 7.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Metersbonwe FashionAc vs. Shenzhen Mindray Bio Medical
Performance |
| Timeline |
| Shanghai Metersbonwe |
| Shenzhen Mindray Bio |
Shanghai Metersbonwe and Shenzhen Mindray Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Metersbonwe and Shenzhen Mindray
The main advantage of trading using opposite Shanghai Metersbonwe and Shenzhen Mindray positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Metersbonwe position performs unexpectedly, Shenzhen Mindray 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 Shenzhen Mindray will offset losses from the drop in Shenzhen Mindray's long position.| Shanghai Metersbonwe vs. Cultural Investment Holdings | Shanghai Metersbonwe vs. Gome Telecom Equipment | Shanghai Metersbonwe vs. Bus Online Co | Shanghai Metersbonwe vs. Holitech Technology Co |
| Shenzhen Mindray vs. Sunwave Communications Co | Shenzhen Mindray vs. Double Medical Technology | Shenzhen Mindray vs. Hengkang Medical Group | Shenzhen Mindray vs. Allwin Telecommunication 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 Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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