Correlation Between Jiangsu Yanghe and Shandong Sino
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By analyzing existing cross correlation between Jiangsu Yanghe Brewery and Shandong Sino Agri United, you can compare the effects of market volatilities on Jiangsu Yanghe and Shandong Sino 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 Jiangsu Yanghe with a short position of Shandong Sino. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Yanghe and Shandong Sino.
Diversification Opportunities for Jiangsu Yanghe and Shandong Sino
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Jiangsu and Shandong is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Yanghe Brewery and Shandong Sino Agri United in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Sino Agri and Jiangsu Yanghe 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 Jiangsu Yanghe Brewery are associated (or correlated) with Shandong Sino. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Sino Agri has no effect on the direction of Jiangsu Yanghe i.e., Jiangsu Yanghe and Shandong Sino go up and down completely randomly.
Pair Corralation between Jiangsu Yanghe and Shandong Sino
Assuming the 90 days trading horizon Jiangsu Yanghe Brewery is expected to generate 0.46 times more return on investment than Shandong Sino. However, Jiangsu Yanghe Brewery is 2.19 times less risky than Shandong Sino. It trades about -0.18 of its potential returns per unit of risk. Shandong Sino Agri United is currently generating about -0.39 per unit of risk. If you would invest 8,568 in Jiangsu Yanghe Brewery on October 7, 2024 and sell it today you would lose (390.00) from holding Jiangsu Yanghe Brewery or give up 4.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu Yanghe Brewery vs. Shandong Sino Agri United
Performance |
| Timeline |
| Jiangsu Yanghe Brewery |
| Shandong Sino Agri |
Jiangsu Yanghe and Shandong Sino Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Yanghe and Shandong Sino
The main advantage of trading using opposite Jiangsu Yanghe and Shandong Sino positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Yanghe position performs unexpectedly, Shandong Sino 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 Shandong Sino will offset losses from the drop in Shandong Sino's long position.| Jiangsu Yanghe vs. China Petroleum Chemical | Jiangsu Yanghe vs. PetroChina Co Ltd | Jiangsu Yanghe vs. China Railway Construction | Jiangsu Yanghe vs. China Mobile Limited |
| Shandong Sino vs. Wuhan Hvsen Biotechnology | Shandong Sino vs. Hangzhou Pinming Software | Shandong Sino vs. Jinling Hotel Corp | Shandong Sino vs. Guangzhou Dongfang Hotel |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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