Correlation Between Sichuan Jinshi and Shanghai Zhangjiang
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By analyzing existing cross correlation between Sichuan Jinshi Technology and Shanghai Zhangjiang Hi Tech, you can compare the effects of market volatilities on Sichuan Jinshi and Shanghai Zhangjiang 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 Jinshi with a short position of Shanghai Zhangjiang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sichuan Jinshi and Shanghai Zhangjiang.
Diversification Opportunities for Sichuan Jinshi and Shanghai Zhangjiang
0.47 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Sichuan and Shanghai is 0.47. Overlapping area represents the amount of risk that can be diversified away by holding Sichuan Jinshi Technology and Shanghai Zhangjiang Hi Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Zhangjiang and Sichuan Jinshi 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 Jinshi Technology are associated (or correlated) with Shanghai Zhangjiang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Zhangjiang has no effect on the direction of Sichuan Jinshi i.e., Sichuan Jinshi and Shanghai Zhangjiang go up and down completely randomly.
Pair Corralation between Sichuan Jinshi and Shanghai Zhangjiang
Assuming the 90 days trading horizon Sichuan Jinshi Technology is expected to under-perform the Shanghai Zhangjiang. But the stock apears to be less risky and, when comparing its historical volatility, Sichuan Jinshi Technology is 1.4 times less risky than Shanghai Zhangjiang. The stock trades about -0.03 of its potential returns per unit of risk. The Shanghai Zhangjiang Hi Tech is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,326 in Shanghai Zhangjiang Hi Tech on November 29, 2024 and sell it today you would earn a total of 1,435 from holding Shanghai Zhangjiang Hi Tech or generate 108.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sichuan Jinshi Technology vs. Shanghai Zhangjiang Hi Tech
Performance |
| Timeline |
| Sichuan Jinshi Technology |
| Shanghai Zhangjiang |
Sichuan Jinshi and Shanghai Zhangjiang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sichuan Jinshi and Shanghai Zhangjiang
The main advantage of trading using opposite Sichuan Jinshi and Shanghai Zhangjiang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sichuan Jinshi position performs unexpectedly, Shanghai Zhangjiang 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 Zhangjiang will offset losses from the drop in Shanghai Zhangjiang's long position.| Sichuan Jinshi vs. Allwin Telecommunication Co | Sichuan Jinshi vs. Fsilon Furnishing and | Sichuan Jinshi vs. Zhejiang Kingland Pipeline | Sichuan Jinshi vs. Guangzhou Huayan Precision |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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