Correlation Between Shenzhen MYS and Chongqing Brewery
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By analyzing existing cross correlation between Shenzhen MYS Environmental and Chongqing Brewery Co, you can compare the effects of market volatilities on Shenzhen MYS and Chongqing Brewery 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 MYS with a short position of Chongqing Brewery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen MYS and Chongqing Brewery.
Diversification Opportunities for Shenzhen MYS and Chongqing Brewery
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shenzhen and Chongqing is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen MYS Environmental and Chongqing Brewery Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chongqing Brewery and Shenzhen MYS 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 MYS Environmental are associated (or correlated) with Chongqing Brewery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chongqing Brewery has no effect on the direction of Shenzhen MYS i.e., Shenzhen MYS and Chongqing Brewery go up and down completely randomly.
Pair Corralation between Shenzhen MYS and Chongqing Brewery
Assuming the 90 days trading horizon Shenzhen MYS Environmental is expected to generate 1.26 times more return on investment than Chongqing Brewery. However, Shenzhen MYS is 1.26 times more volatile than Chongqing Brewery Co. It trades about 0.07 of its potential returns per unit of risk. Chongqing Brewery Co is currently generating about 0.02 per unit of risk. If you would invest 281.00 in Shenzhen MYS Environmental on September 12, 2024 and sell it today you would earn a total of 132.00 from holding Shenzhen MYS Environmental or generate 46.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen MYS Environmental vs. Chongqing Brewery Co
Performance |
| Timeline |
| Shenzhen MYS Environ |
| Chongqing Brewery |
Shenzhen MYS and Chongqing Brewery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen MYS and Chongqing Brewery
The main advantage of trading using opposite Shenzhen MYS and Chongqing Brewery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen MYS position performs unexpectedly, Chongqing Brewery 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 Chongqing Brewery will offset losses from the drop in Chongqing Brewery's long position.| Shenzhen MYS vs. Zijin Mining Group | Shenzhen MYS vs. Wanhua Chemical Group | Shenzhen MYS vs. Baoshan Iron Steel | Shenzhen MYS vs. Rongsheng Petrochemical Co |
| Chongqing Brewery vs. China Petroleum Chemical | Chongqing Brewery vs. PetroChina Co Ltd | Chongqing Brewery vs. China State Construction | Chongqing Brewery vs. China Railway 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 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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