Correlation Between Guangzhou Jointas and Shandong Polymer
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By analyzing existing cross correlation between Guangzhou Jointas Chemical and Shandong Polymer Biochemicals, you can compare the effects of market volatilities on Guangzhou Jointas and Shandong Polymer 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 Jointas with a short position of Shandong Polymer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou Jointas and Shandong Polymer.
Diversification Opportunities for Guangzhou Jointas and Shandong Polymer
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangzhou and Shandong is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou Jointas Chemical and Shandong Polymer Biochemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Polymer Bio and Guangzhou Jointas 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 Jointas Chemical are associated (or correlated) with Shandong Polymer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Polymer Bio has no effect on the direction of Guangzhou Jointas i.e., Guangzhou Jointas and Shandong Polymer go up and down completely randomly.
Pair Corralation between Guangzhou Jointas and Shandong Polymer
Assuming the 90 days trading horizon Guangzhou Jointas is expected to generate 1.31 times less return on investment than Shandong Polymer. In addition to that, Guangzhou Jointas is 1.01 times more volatile than Shandong Polymer Biochemicals. It trades about 0.04 of its total potential returns per unit of risk. Shandong Polymer Biochemicals is currently generating about 0.06 per unit of volatility. If you would invest 395.00 in Shandong Polymer Biochemicals on August 29, 2024 and sell it today you would earn a total of 63.00 from holding Shandong Polymer Biochemicals or generate 15.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou Jointas Chemical vs. Shandong Polymer Biochemicals
Performance |
| Timeline |
| Guangzhou Jointas |
| Shandong Polymer Bio |
Guangzhou Jointas and Shandong Polymer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou Jointas and Shandong Polymer
The main advantage of trading using opposite Guangzhou Jointas and Shandong Polymer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou Jointas position performs unexpectedly, Shandong Polymer 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 Shandong Polymer will offset losses from the drop in Shandong Polymer's long position.| Guangzhou Jointas vs. Zijin Mining Group | Guangzhou Jointas vs. Baoshan Iron Steel | Guangzhou Jointas vs. Shandong Gold Mining | Guangzhou Jointas vs. Rongsheng Petrochemical Co |
| Shandong Polymer vs. Zijin Mining Group | Shandong Polymer vs. Wanhua Chemical Group | Shandong Polymer vs. Baoshan Iron Steel | Shandong Polymer vs. Shandong Gold Mining |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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