Correlation Between Shenzhen Mindray and Shenzhen Bioeasy
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By analyzing existing cross correlation between Shenzhen Mindray Bio Medical and Shenzhen Bioeasy Biotechnology, you can compare the effects of market volatilities on Shenzhen Mindray and Shenzhen Bioeasy 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 Shenzhen Mindray with a short position of Shenzhen Bioeasy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Mindray and Shenzhen Bioeasy.
Diversification Opportunities for Shenzhen Mindray and Shenzhen Bioeasy
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shenzhen and Shenzhen is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Mindray Bio Medical and Shenzhen Bioeasy Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Bioeasy Bio and Shenzhen Mindray 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 Shenzhen Mindray Bio Medical are associated (or correlated) with Shenzhen Bioeasy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Bioeasy Bio has no effect on the direction of Shenzhen Mindray i.e., Shenzhen Mindray and Shenzhen Bioeasy go up and down completely randomly.
Pair Corralation between Shenzhen Mindray and Shenzhen Bioeasy
Assuming the 90 days trading horizon Shenzhen Mindray Bio Medical is expected to under-perform the Shenzhen Bioeasy. But the stock apears to be less risky and, when comparing its historical volatility, Shenzhen Mindray Bio Medical is 2.96 times less risky than Shenzhen Bioeasy. The stock trades about -0.07 of its potential returns per unit of risk. The Shenzhen Bioeasy Biotechnology is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 840.00 in Shenzhen Bioeasy Biotechnology on September 5, 2024 and sell it today you would earn a total of 152.00 from holding Shenzhen Bioeasy Biotechnology or generate 18.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Mindray Bio Medical vs. Shenzhen Bioeasy Biotechnology
Performance |
| Timeline |
| Shenzhen Mindray Bio |
| Shenzhen Bioeasy Bio |
Shenzhen Mindray and Shenzhen Bioeasy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Mindray and Shenzhen Bioeasy
The main advantage of trading using opposite Shenzhen Mindray and Shenzhen Bioeasy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Mindray position performs unexpectedly, Shenzhen Bioeasy 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 Bioeasy will offset losses from the drop in Shenzhen Bioeasy's long position.| Shenzhen Mindray vs. Eastroc Beverage Group | Shenzhen Mindray vs. Zhejiang Qianjiang Motorcycle | Shenzhen Mindray vs. Anhui Huilong Agricultural | Shenzhen Mindray vs. Beijing Yanjing Brewery |
| Shenzhen Bioeasy vs. Kweichow Moutai Co | Shenzhen Bioeasy vs. Shenzhen Mindray Bio Medical | Shenzhen Bioeasy vs. Jiangsu Pacific Quartz | Shenzhen Bioeasy vs. G bits Network Technology |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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