Correlation Between SH Energy and Youngbo Chemical
Can any of the company-specific risk be diversified away by investing in both SH Energy and Youngbo Chemical at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining SH Energy and Youngbo Chemical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SH Energy Chemical and Youngbo Chemical Co, you can compare the effects of market volatilities on SH Energy and Youngbo Chemical 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 SH Energy with a short position of Youngbo Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of SH Energy and Youngbo Chemical.
Diversification Opportunities for SH Energy and Youngbo Chemical
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between 002360 and Youngbo is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding SH Energy Chemical and Youngbo Chemical Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Youngbo Chemical and SH Energy 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 SH Energy Chemical are associated (or correlated) with Youngbo Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Youngbo Chemical has no effect on the direction of SH Energy i.e., SH Energy and Youngbo Chemical go up and down completely randomly.
Pair Corralation between SH Energy and Youngbo Chemical
Assuming the 90 days trading horizon SH Energy Chemical is expected to generate 3.92 times more return on investment than Youngbo Chemical. However, SH Energy is 3.92 times more volatile than Youngbo Chemical Co. It trades about 0.12 of its potential returns per unit of risk. Youngbo Chemical Co is currently generating about 0.16 per unit of risk. If you would invest 50,900 in SH Energy Chemical on August 29, 2024 and sell it today you would earn a total of 4,100 from holding SH Energy Chemical or generate 8.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
SH Energy Chemical vs. Youngbo Chemical Co
Performance |
| Timeline |
| SH Energy Chemical |
| Youngbo Chemical |
SH Energy and Youngbo Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SH Energy and Youngbo Chemical
The main advantage of trading using opposite SH Energy and Youngbo Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SH Energy position performs unexpectedly, Youngbo Chemical 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 Youngbo Chemical will offset losses from the drop in Youngbo Chemical's long position.| SH Energy vs. AptaBio Therapeutics | SH Energy vs. Daewoo SBI SPAC | SH Energy vs. Dream Security co | SH Energy vs. Microfriend |
| Youngbo Chemical vs. AptaBio Therapeutics | Youngbo Chemical vs. Daewoo SBI SPAC | Youngbo Chemical vs. Dream Security co | Youngbo Chemical vs. Microfriend |
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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Other Complementary Tools
| Portfolio Backtesting Avoid under-diversification and over-optimization by backtesting your portfolios | |
| Portfolio Diagnostics Use generated alerts and portfolio events aggregator to diagnose current holdings | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine |