Correlation Between Chongqing Shunbo and Shenzhen Mindray
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By analyzing existing cross correlation between Chongqing Shunbo Aluminum and Shenzhen Mindray Bio Medical, you can compare the effects of market volatilities on Chongqing Shunbo and Shenzhen Mindray 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 Chongqing Shunbo with a short position of Shenzhen Mindray. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Shunbo and Shenzhen Mindray.
Diversification Opportunities for Chongqing Shunbo and Shenzhen Mindray
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Chongqing and Shenzhen is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Shunbo Aluminum and Shenzhen Mindray Bio Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Mindray Bio and Chongqing Shunbo 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 Chongqing Shunbo Aluminum are associated (or correlated) with Shenzhen Mindray. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Mindray Bio has no effect on the direction of Chongqing Shunbo i.e., Chongqing Shunbo and Shenzhen Mindray go up and down completely randomly.
Pair Corralation between Chongqing Shunbo and Shenzhen Mindray
Assuming the 90 days trading horizon Chongqing Shunbo Aluminum is expected to under-perform the Shenzhen Mindray. In addition to that, Chongqing Shunbo is 1.27 times more volatile than Shenzhen Mindray Bio Medical. It trades about -0.03 of its total potential returns per unit of risk. Shenzhen Mindray Bio Medical is currently generating about 0.0 per unit of volatility. If you would invest 29,502 in Shenzhen Mindray Bio Medical on September 3, 2024 and sell it today you would lose (3,453) from holding Shenzhen Mindray Bio Medical or give up 11.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chongqing Shunbo Aluminum vs. Shenzhen Mindray Bio Medical
Performance |
| Timeline |
| Chongqing Shunbo Aluminum |
| Shenzhen Mindray Bio |
Chongqing Shunbo and Shenzhen Mindray Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chongqing Shunbo and Shenzhen Mindray
The main advantage of trading using opposite Chongqing Shunbo and Shenzhen Mindray positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Shunbo position performs unexpectedly, Shenzhen Mindray 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 Shenzhen Mindray will offset losses from the drop in Shenzhen Mindray's long position.| Chongqing Shunbo vs. Zijin Mining Group | Chongqing Shunbo vs. Baoshan Iron Steel | Chongqing Shunbo vs. Rongsheng Petrochemical Co | Chongqing Shunbo vs. Hoshine Silicon Ind |
| Shenzhen Mindray vs. Chongqing Shunbo Aluminum | Shenzhen Mindray vs. Quectel Wireless Solutions | Shenzhen Mindray vs. Rising Nonferrous Metals | Shenzhen Mindray vs. Ye Chiu Metal |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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