Correlation Between Yingde Greatchem and City Development
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By analyzing existing cross correlation between Yingde Greatchem Chemicals and City Development Environment, you can compare the effects of market volatilities on Yingde Greatchem and City Development 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 Yingde Greatchem with a short position of City Development. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yingde Greatchem and City Development.
Diversification Opportunities for Yingde Greatchem and City Development
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Yingde and City is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Yingde Greatchem Chemicals and City Development Environment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on City Development Env and Yingde Greatchem 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 Yingde Greatchem Chemicals are associated (or correlated) with City Development. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of City Development Env has no effect on the direction of Yingde Greatchem i.e., Yingde Greatchem and City Development go up and down completely randomly.
Pair Corralation between Yingde Greatchem and City Development
Assuming the 90 days trading horizon Yingde Greatchem Chemicals is expected to under-perform the City Development. In addition to that, Yingde Greatchem is 1.54 times more volatile than City Development Environment. It trades about -0.02 of its total potential returns per unit of risk. City Development Environment is currently generating about 0.05 per unit of volatility. If you would invest 937.00 in City Development Environment on August 31, 2024 and sell it today you would earn a total of 411.00 from holding City Development Environment or generate 43.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 75.93% |
| Values | Daily Returns |
Yingde Greatchem Chemicals vs. City Development Environment
Performance |
| Timeline |
| Yingde Greatchem Che |
| City Development Env |
Yingde Greatchem and City Development Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yingde Greatchem and City Development
The main advantage of trading using opposite Yingde Greatchem and City Development positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yingde Greatchem position performs unexpectedly, City Development 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 City Development will offset losses from the drop in City Development's long position.| Yingde Greatchem vs. Xinjiang Communications Construction | Yingde Greatchem vs. Xiangyang Automobile Bearing | Yingde Greatchem vs. Tianshan Aluminum Group | Yingde Greatchem vs. Shenzhen Kexin Communication |
| City Development vs. Anhui Gujing Distillery | City Development vs. Tianjin Hi Tech Development | City Development vs. Guangdong Shenglu Telecommunication | City Development vs. BTG Hotels 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 Portfolio Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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