Correlation Between Shantou Wanshun and Sichuan Teway
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By analyzing existing cross correlation between Shantou Wanshun Package and Sichuan Teway Food, you can compare the effects of market volatilities on Shantou Wanshun and Sichuan Teway 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 Shantou Wanshun with a short position of Sichuan Teway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shantou Wanshun and Sichuan Teway.
Diversification Opportunities for Shantou Wanshun and Sichuan Teway
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shantou and Sichuan is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Shantou Wanshun Package and Sichuan Teway Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sichuan Teway Food and Shantou Wanshun 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 Shantou Wanshun Package are associated (or correlated) with Sichuan Teway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sichuan Teway Food has no effect on the direction of Shantou Wanshun i.e., Shantou Wanshun and Sichuan Teway go up and down completely randomly.
Pair Corralation between Shantou Wanshun and Sichuan Teway
Assuming the 90 days trading horizon Shantou Wanshun Package is expected to under-perform the Sichuan Teway. In addition to that, Shantou Wanshun is 1.45 times more volatile than Sichuan Teway Food. It trades about -0.02 of its total potential returns per unit of risk. Sichuan Teway Food is currently generating about -0.02 per unit of volatility. If you would invest 1,831 in Sichuan Teway Food on August 27, 2024 and sell it today you would lose (496.00) from holding Sichuan Teway Food or give up 27.09% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shantou Wanshun Package vs. Sichuan Teway Food
Performance |
| Timeline |
| Shantou Wanshun Package |
| Sichuan Teway Food |
Shantou Wanshun and Sichuan Teway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shantou Wanshun and Sichuan Teway
The main advantage of trading using opposite Shantou Wanshun and Sichuan Teway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shantou Wanshun position performs unexpectedly, Sichuan Teway 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 Sichuan Teway will offset losses from the drop in Sichuan Teway's long position.| Shantou Wanshun vs. Zijin Mining Group | Shantou Wanshun vs. Wanhua Chemical Group | Shantou Wanshun vs. Baoshan Iron Steel | Shantou Wanshun vs. Shandong Gold Mining |
| Sichuan Teway vs. China Petroleum Chemical | Sichuan Teway vs. PetroChina Co Ltd | Sichuan Teway vs. China State Construction | Sichuan Teway vs. China Railway Group |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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