Correlation Between Shandong Polymer and Tsingtao Brewery
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By analyzing existing cross correlation between Shandong Polymer Biochemicals and Tsingtao Brewery Co, you can compare the effects of market volatilities on Shandong Polymer and Tsingtao 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 Shandong Polymer with a short position of Tsingtao Brewery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Polymer and Tsingtao Brewery.
Diversification Opportunities for Shandong Polymer and Tsingtao Brewery
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shandong and Tsingtao is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Polymer Biochemicals and Tsingtao Brewery Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tsingtao Brewery and Shandong Polymer 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 Shandong Polymer Biochemicals are associated (or correlated) with Tsingtao Brewery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tsingtao Brewery has no effect on the direction of Shandong Polymer i.e., Shandong Polymer and Tsingtao Brewery go up and down completely randomly.
Pair Corralation between Shandong Polymer and Tsingtao Brewery
Assuming the 90 days trading horizon Shandong Polymer Biochemicals is expected to under-perform the Tsingtao Brewery. In addition to that, Shandong Polymer is 1.37 times more volatile than Tsingtao Brewery Co. It trades about -0.02 of its total potential returns per unit of risk. Tsingtao Brewery Co is currently generating about 0.01 per unit of volatility. If you would invest 7,160 in Tsingtao Brewery Co on September 2, 2024 and sell it today you would earn a total of 138.00 from holding Tsingtao Brewery Co or generate 1.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Polymer Biochemicals vs. Tsingtao Brewery Co
Performance |
| Timeline |
| Shandong Polymer Bio |
| Tsingtao Brewery |
Shandong Polymer and Tsingtao Brewery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Polymer and Tsingtao Brewery
The main advantage of trading using opposite Shandong Polymer and Tsingtao Brewery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Polymer position performs unexpectedly, Tsingtao 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 Tsingtao Brewery will offset losses from the drop in Tsingtao Brewery's long position.| Shandong Polymer vs. Zijin Mining Group | Shandong Polymer vs. Wanhua Chemical Group | Shandong Polymer vs. Baoshan Iron Steel | Shandong Polymer vs. Shandong Gold Mining |
| Tsingtao Brewery vs. Guangdong Qunxing Toys | Tsingtao Brewery vs. Miracll Chemicals Co | Tsingtao Brewery vs. Ningxia Younglight Chemicals | Tsingtao Brewery vs. Shandong Polymer Biochemicals |
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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