Correlation Between Guangzhou Tinci and Shanghai Ziyan
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By analyzing existing cross correlation between Guangzhou Tinci Materials and Shanghai Ziyan Foods, you can compare the effects of market volatilities on Guangzhou Tinci and Shanghai Ziyan 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 Guangzhou Tinci with a short position of Shanghai Ziyan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Tinci and Shanghai Ziyan.
Diversification Opportunities for Guangzhou Tinci and Shanghai Ziyan
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Guangzhou and Shanghai is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Tinci Materials and Shanghai Ziyan Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Ziyan Foods and Guangzhou Tinci 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 Guangzhou Tinci Materials are associated (or correlated) with Shanghai Ziyan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Ziyan Foods has no effect on the direction of Guangzhou Tinci i.e., Guangzhou Tinci and Shanghai Ziyan go up and down completely randomly.
Pair Corralation between Guangzhou Tinci and Shanghai Ziyan
Assuming the 90 days trading horizon Guangzhou Tinci is expected to generate 1.38 times less return on investment than Shanghai Ziyan. In addition to that, Guangzhou Tinci is 1.2 times more volatile than Shanghai Ziyan Foods. It trades about 0.05 of its total potential returns per unit of risk. Shanghai Ziyan Foods is currently generating about 0.08 per unit of volatility. If you would invest 1,384 in Shanghai Ziyan Foods on October 18, 2024 and sell it today you would earn a total of 365.00 from holding Shanghai Ziyan Foods or generate 26.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Tinci Materials vs. Shanghai Ziyan Foods
Performance |
| Timeline |
| Guangzhou Tinci Materials |
| Shanghai Ziyan Foods |
Guangzhou Tinci and Shanghai Ziyan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Tinci and Shanghai Ziyan
The main advantage of trading using opposite Guangzhou Tinci and Shanghai Ziyan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Tinci position performs unexpectedly, Shanghai Ziyan 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 Shanghai Ziyan will offset losses from the drop in Shanghai Ziyan's long position.| Guangzhou Tinci vs. Rising Nonferrous Metals | Guangzhou Tinci vs. China Minmetals Rare | Guangzhou Tinci vs. Anhui Transport Consulting | Guangzhou Tinci vs. Xinjiang Beixin RoadBridge |
| Shanghai Ziyan vs. Beijing Watertek Information | Shanghai Ziyan vs. StarPower Semiconductor | Shanghai Ziyan vs. Zhongfu Information | Shanghai Ziyan vs. Qiming Information Technology |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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