Correlation Between Sichuan Yahua and Shenzhen Fortune
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By analyzing existing cross correlation between Sichuan Yahua Industrial and Shenzhen Fortune Trend, you can compare the effects of market volatilities on Sichuan Yahua and Shenzhen Fortune 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 Sichuan Yahua with a short position of Shenzhen Fortune. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sichuan Yahua and Shenzhen Fortune.
Diversification Opportunities for Sichuan Yahua and Shenzhen Fortune
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Sichuan and Shenzhen is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Sichuan Yahua Industrial and Shenzhen Fortune Trend in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Fortune Trend and Sichuan Yahua 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 Sichuan Yahua Industrial are associated (or correlated) with Shenzhen Fortune. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Fortune Trend has no effect on the direction of Sichuan Yahua i.e., Sichuan Yahua and Shenzhen Fortune go up and down completely randomly.
Pair Corralation between Sichuan Yahua and Shenzhen Fortune
Assuming the 90 days trading horizon Sichuan Yahua Industrial is expected to generate 0.57 times more return on investment than Shenzhen Fortune. However, Sichuan Yahua Industrial is 1.74 times less risky than Shenzhen Fortune. It trades about 0.13 of its potential returns per unit of risk. Shenzhen Fortune Trend is currently generating about 0.07 per unit of risk. If you would invest 1,198 in Sichuan Yahua Industrial on September 13, 2024 and sell it today you would earn a total of 84.00 from holding Sichuan Yahua Industrial or generate 7.01% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sichuan Yahua Industrial vs. Shenzhen Fortune Trend
Performance |
| Timeline |
| Sichuan Yahua Industrial |
| Shenzhen Fortune Trend |
Sichuan Yahua and Shenzhen Fortune Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sichuan Yahua and Shenzhen Fortune
The main advantage of trading using opposite Sichuan Yahua and Shenzhen Fortune positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sichuan Yahua position performs unexpectedly, Shenzhen Fortune 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 Shenzhen Fortune will offset losses from the drop in Shenzhen Fortune's long position.| Sichuan Yahua vs. Zijin Mining Group | Sichuan Yahua vs. Wanhua Chemical Group | Sichuan Yahua vs. Baoshan Iron Steel | Sichuan Yahua vs. Shandong Gold Mining |
| Shenzhen Fortune vs. AUPU Home Style | Shenzhen Fortune vs. New Hope Dairy | Shenzhen Fortune vs. Xinjiang Tianrun Dairy | Shenzhen Fortune vs. Anji Foodstuff Co |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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