Correlation Between Penghua Shenzhen and Shenzhen Bingchuan
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By analyzing existing cross correlation between Penghua Shenzhen Energy and Shenzhen Bingchuan Network, you can compare the effects of market volatilities on Penghua Shenzhen and Shenzhen Bingchuan 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 Penghua Shenzhen with a short position of Shenzhen Bingchuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Penghua Shenzhen and Shenzhen Bingchuan.
Diversification Opportunities for Penghua Shenzhen and Shenzhen Bingchuan
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Penghua and Shenzhen is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Penghua Shenzhen Energy and Shenzhen Bingchuan Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Bingchuan and Penghua Shenzhen 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 Penghua Shenzhen Energy are associated (or correlated) with Shenzhen Bingchuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Bingchuan has no effect on the direction of Penghua Shenzhen i.e., Penghua Shenzhen and Shenzhen Bingchuan go up and down completely randomly.
Pair Corralation between Penghua Shenzhen and Shenzhen Bingchuan
Assuming the 90 days trading horizon Penghua Shenzhen Energy is expected to under-perform the Shenzhen Bingchuan. But the stock apears to be less risky and, when comparing its historical volatility, Penghua Shenzhen Energy is 5.02 times less risky than Shenzhen Bingchuan. The stock trades about -0.08 of its potential returns per unit of risk. The Shenzhen Bingchuan Network is currently generating about 0.18 of returns per unit of risk over similar time horizon. If you would invest 1,942 in Shenzhen Bingchuan Network on November 3, 2024 and sell it today you would earn a total of 198.00 from holding Shenzhen Bingchuan Network or generate 10.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Penghua Shenzhen Energy vs. Shenzhen Bingchuan Network
Performance |
| Timeline |
| Penghua Shenzhen Energy |
| Shenzhen Bingchuan |
Penghua Shenzhen and Shenzhen Bingchuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Penghua Shenzhen and Shenzhen Bingchuan
The main advantage of trading using opposite Penghua Shenzhen and Shenzhen Bingchuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Penghua Shenzhen position performs unexpectedly, Shenzhen Bingchuan 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 Bingchuan will offset losses from the drop in Shenzhen Bingchuan's long position.| Penghua Shenzhen vs. China Publishing Media | Penghua Shenzhen vs. Biwin Storage Technology | Penghua Shenzhen vs. Heilongjiang Publishing Media | Penghua Shenzhen vs. Chengdu B ray Media |
| Shenzhen Bingchuan vs. Lier Chemical Co | Shenzhen Bingchuan vs. Lianhe Chemical Technology | Shenzhen Bingchuan vs. Huasi Agricultural Development | Shenzhen Bingchuan vs. Tjk Machinery Tianjin |
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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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