Correlation Between Shandong Ruifeng and Shandong Polymer
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By analyzing existing cross correlation between Shandong Ruifeng Chemical and Shandong Polymer Biochemicals, you can compare the effects of market volatilities on Shandong Ruifeng 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 Shandong Ruifeng with a short position of Shandong Polymer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Ruifeng and Shandong Polymer.
Diversification Opportunities for Shandong Ruifeng and Shandong Polymer
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shandong and Shandong is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Ruifeng 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 Shandong Ruifeng 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 Shandong Ruifeng 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 Shandong Ruifeng i.e., Shandong Ruifeng and Shandong Polymer go up and down completely randomly.
Pair Corralation between Shandong Ruifeng and Shandong Polymer
Assuming the 90 days trading horizon Shandong Ruifeng Chemical is expected to generate 1.47 times more return on investment than Shandong Polymer. However, Shandong Ruifeng is 1.47 times more volatile than Shandong Polymer Biochemicals. It trades about 0.08 of its potential returns per unit of risk. Shandong Polymer Biochemicals is currently generating about 0.08 per unit of risk. If you would invest 1,030 in Shandong Ruifeng Chemical on September 1, 2024 and sell it today you would earn a total of 70.00 from holding Shandong Ruifeng Chemical or generate 6.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Shandong Ruifeng Chemical vs. Shandong Polymer Biochemicals
Performance |
| Timeline |
| Shandong Ruifeng Chemical |
| Shandong Polymer Bio |
Shandong Ruifeng and Shandong Polymer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Ruifeng and Shandong Polymer
The main advantage of trading using opposite Shandong Ruifeng and Shandong Polymer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Ruifeng 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.| Shandong Ruifeng vs. Jiajia Food Group | Shandong Ruifeng vs. Hunan Mendale Hometextile | Shandong Ruifeng vs. Juewei Food Co | Shandong Ruifeng vs. JuneYao Dairy Co |
| Shandong Polymer vs. Everdisplay Optronics Shanghai | Shandong Polymer vs. Keeson Technology Corp | Shandong Polymer vs. Uxi Unicomp Technology | Shandong Polymer vs. Threes Company Media |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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