Correlation Between Shenzhen Silver and Beijing Yanjing
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By analyzing existing cross correlation between Shenzhen Silver Basis and Beijing Yanjing Brewery, you can compare the effects of market volatilities on Shenzhen Silver and Beijing Yanjing 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 Shenzhen Silver with a short position of Beijing Yanjing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Silver and Beijing Yanjing.
Diversification Opportunities for Shenzhen Silver and Beijing Yanjing
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shenzhen and Beijing is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Silver Basis and Beijing Yanjing Brewery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Yanjing Brewery and Shenzhen Silver 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 Shenzhen Silver Basis are associated (or correlated) with Beijing Yanjing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Yanjing Brewery has no effect on the direction of Shenzhen Silver i.e., Shenzhen Silver and Beijing Yanjing go up and down completely randomly.
Pair Corralation between Shenzhen Silver and Beijing Yanjing
Assuming the 90 days trading horizon Shenzhen Silver Basis is expected to under-perform the Beijing Yanjing. In addition to that, Shenzhen Silver is 1.87 times more volatile than Beijing Yanjing Brewery. It trades about -0.13 of its total potential returns per unit of risk. Beijing Yanjing Brewery is currently generating about 0.22 per unit of volatility. If you would invest 1,039 in Beijing Yanjing Brewery on September 14, 2024 and sell it today you would earn a total of 81.00 from holding Beijing Yanjing Brewery or generate 7.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Silver Basis vs. Beijing Yanjing Brewery
Performance |
| Timeline |
| Shenzhen Silver Basis |
| Beijing Yanjing Brewery |
Shenzhen Silver and Beijing Yanjing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Silver and Beijing Yanjing
The main advantage of trading using opposite Shenzhen Silver and Beijing Yanjing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Silver position performs unexpectedly, Beijing Yanjing 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 Yanjing will offset losses from the drop in Beijing Yanjing's long position.| Shenzhen Silver vs. Jointo Energy Investment | Shenzhen Silver vs. Harbin Air Conditioning | Shenzhen Silver vs. Harbin Hatou Investment | Shenzhen Silver vs. Jiangsu Yueda Investment |
| Beijing Yanjing vs. Fiberhome Telecommunication Technologies | Beijing Yanjing vs. Western Mining Co | Beijing Yanjing vs. Hainan Mining Co | Beijing Yanjing vs. JCHX Mining Management |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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