Correlation Between Shenzhen MYS and Henan Lantian
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By analyzing existing cross correlation between Shenzhen MYS Environmental and Henan Lantian Gas, you can compare the effects of market volatilities on Shenzhen MYS and Henan Lantian 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 Henan Lantian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen MYS and Henan Lantian.
Diversification Opportunities for Shenzhen MYS and Henan Lantian
-0.67 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Shenzhen and Henan is -0.67. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen MYS Environmental and Henan Lantian Gas in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Henan Lantian Gas 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 Henan Lantian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Henan Lantian Gas has no effect on the direction of Shenzhen MYS i.e., Shenzhen MYS and Henan Lantian go up and down completely randomly.
Pair Corralation between Shenzhen MYS and Henan Lantian
Assuming the 90 days trading horizon Shenzhen MYS Environmental is expected to generate 1.39 times more return on investment than Henan Lantian. However, Shenzhen MYS is 1.39 times more volatile than Henan Lantian Gas. It trades about 0.05 of its potential returns per unit of risk. Henan Lantian Gas is currently generating about 0.06 per unit of risk. If you would invest 282.00 in Shenzhen MYS Environmental on August 25, 2024 and sell it today you would earn a total of 93.00 from holding Shenzhen MYS Environmental or generate 32.98% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen MYS Environmental vs. Henan Lantian Gas
Performance |
| Timeline |
| Shenzhen MYS Environ |
| Henan Lantian Gas |
Shenzhen MYS and Henan Lantian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen MYS and Henan Lantian
The main advantage of trading using opposite Shenzhen MYS and Henan Lantian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen MYS position performs unexpectedly, Henan Lantian 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 Henan Lantian will offset losses from the drop in Henan Lantian's long position.| Shenzhen MYS vs. Zijin Mining Group | Shenzhen MYS vs. Wanhua Chemical Group | Shenzhen MYS vs. Baoshan Iron Steel | Shenzhen MYS vs. Shandong Gold Mining |
| Henan Lantian vs. Cambricon Technologies Corp | Henan Lantian vs. Loongson Technology Corp | Henan Lantian vs. Chongqing Road Bridge | Henan Lantian vs. Shenzhen Fortune Trend |
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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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