Correlation Between Shenzhen MYS and Hang Xiao
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By analyzing existing cross correlation between Shenzhen MYS Environmental and Hang Xiao Steel, you can compare the effects of market volatilities on Shenzhen MYS and Hang Xiao 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 Hang Xiao. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen MYS and Hang Xiao.
Diversification Opportunities for Shenzhen MYS and Hang Xiao
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shenzhen and Hang is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen MYS Environmental and Hang Xiao Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hang Xiao Steel 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 Hang Xiao. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hang Xiao Steel has no effect on the direction of Shenzhen MYS i.e., Shenzhen MYS and Hang Xiao go up and down completely randomly.
Pair Corralation between Shenzhen MYS and Hang Xiao
Assuming the 90 days trading horizon Shenzhen MYS Environmental is expected to generate 1.07 times more return on investment than Hang Xiao. However, Shenzhen MYS is 1.07 times more volatile than Hang Xiao Steel. It trades about 0.03 of its potential returns per unit of risk. Hang Xiao Steel is currently generating about -0.04 per unit of risk. If you would invest 296.00 in Shenzhen MYS Environmental on August 30, 2024 and sell it today you would earn a total of 79.00 from holding Shenzhen MYS Environmental or generate 26.69% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen MYS Environmental vs. Hang Xiao Steel
Performance |
| Timeline |
| Shenzhen MYS Environ |
| Hang Xiao Steel |
Shenzhen MYS and Hang Xiao Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen MYS and Hang Xiao
The main advantage of trading using opposite Shenzhen MYS and Hang Xiao positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen MYS position performs unexpectedly, Hang Xiao 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 Hang Xiao will offset losses from the drop in Hang Xiao's long position.| Shenzhen MYS vs. Shandong Gold Mining | Shenzhen MYS vs. Rongsheng Petrochemical Co | Shenzhen MYS vs. Inner Mongolia BaoTou | Shenzhen MYS vs. Jiangxi Ganfeng Lithium |
| Hang Xiao vs. PetroChina Co Ltd | Hang Xiao vs. China State Construction | Hang Xiao vs. China Mobile Limited | Hang Xiao vs. Industrial and Commercial |
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 Equity Valuation module to check real value of public entities based on technical and fundamental data.
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