Correlation Between Shanghai Phichem and Shenyang Blue
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By analyzing existing cross correlation between Shanghai Phichem Material and Shenyang Blue Silver, you can compare the effects of market volatilities on Shanghai Phichem and Shenyang Blue 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 Shanghai Phichem with a short position of Shenyang Blue. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Phichem and Shenyang Blue.
Diversification Opportunities for Shanghai Phichem and Shenyang Blue
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shanghai and Shenyang is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Phichem Material and Shenyang Blue Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenyang Blue Silver and Shanghai Phichem 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 Shanghai Phichem Material are associated (or correlated) with Shenyang Blue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenyang Blue Silver has no effect on the direction of Shanghai Phichem i.e., Shanghai Phichem and Shenyang Blue go up and down completely randomly.
Pair Corralation between Shanghai Phichem and Shenyang Blue
Assuming the 90 days trading horizon Shanghai Phichem is expected to generate 5.56 times less return on investment than Shenyang Blue. But when comparing it to its historical volatility, Shanghai Phichem Material is 1.36 times less risky than Shenyang Blue. It trades about 0.01 of its potential returns per unit of risk. Shenyang Blue Silver is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 1,144 in Shenyang Blue Silver on November 1, 2024 and sell it today you would earn a total of 992.00 from holding Shenyang Blue Silver or generate 86.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Phichem Material vs. Shenyang Blue Silver
Performance |
| Timeline |
| Shanghai Phichem Material |
| Shenyang Blue Silver |
Shanghai Phichem and Shenyang Blue Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Phichem and Shenyang Blue
The main advantage of trading using opposite Shanghai Phichem and Shenyang Blue positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Phichem position performs unexpectedly, Shenyang Blue 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 Shenyang Blue will offset losses from the drop in Shenyang Blue's long position.| Shanghai Phichem vs. Baoshan Iron Steel | Shanghai Phichem vs. Beijing Kaiwen Education | Shanghai Phichem vs. Elite Color Environmental | Shanghai Phichem vs. Qtone Education Group |
| Shenyang Blue vs. Yuanjie Semiconductor Technology | Shenyang Blue vs. Changjiang Publishing Media | Shenyang Blue vs. China Publishing Media | Shenyang Blue vs. Shanghai V Test Semiconductor |
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 Portfolio Holdings module to check your current holdings and cash postion to detemine if your portfolio needs rebalancing.
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