Correlation Between Shanghai Yaoji and Beijing YanDong
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By analyzing existing cross correlation between Shanghai Yaoji Playing and Beijing YanDong MicroElectronic, you can compare the effects of market volatilities on Shanghai Yaoji and Beijing YanDong 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 Shanghai Yaoji with a short position of Beijing YanDong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Yaoji and Beijing YanDong.
Diversification Opportunities for Shanghai Yaoji and Beijing YanDong
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shanghai and Beijing is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Yaoji Playing and Beijing YanDong MicroElectroni in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing YanDong Micr and Shanghai Yaoji 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 Shanghai Yaoji Playing are associated (or correlated) with Beijing YanDong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing YanDong Micr has no effect on the direction of Shanghai Yaoji i.e., Shanghai Yaoji and Beijing YanDong go up and down completely randomly.
Pair Corralation between Shanghai Yaoji and Beijing YanDong
Assuming the 90 days trading horizon Shanghai Yaoji Playing is expected to generate 1.12 times more return on investment than Beijing YanDong. However, Shanghai Yaoji is 1.12 times more volatile than Beijing YanDong MicroElectronic. It trades about 0.05 of its potential returns per unit of risk. Beijing YanDong MicroElectronic is currently generating about 0.01 per unit of risk. If you would invest 1,423 in Shanghai Yaoji Playing on October 16, 2024 and sell it today you would earn a total of 1,287 from holding Shanghai Yaoji Playing or generate 90.44% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Yaoji Playing vs. Beijing YanDong MicroElectroni
Performance |
| Timeline |
| Shanghai Yaoji Playing |
| Beijing YanDong Micr |
Shanghai Yaoji and Beijing YanDong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Yaoji and Beijing YanDong
The main advantage of trading using opposite Shanghai Yaoji and Beijing YanDong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Yaoji position performs unexpectedly, Beijing YanDong 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 Beijing YanDong will offset losses from the drop in Beijing YanDong's long position.| Shanghai Yaoji vs. Anhui Huaren Health | Shanghai Yaoji vs. Mingchen Health Co | Shanghai Yaoji vs. Shanghai Sanyou Medical | Shanghai Yaoji vs. Meinian Onehealth Healthcare |
| Beijing YanDong vs. GRG Banking Equipment | Beijing YanDong vs. Beijing Enlight Media | Beijing YanDong vs. JiShi Media Co | Beijing YanDong vs. Jiangsu Financial Leasing |
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 Headlines Timeline module to stay connected to all market stories and filter out noise. Drill down to analyze hype elasticity.
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