Correlation Between Eit Environmental and Shanghai Pudong
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By analyzing existing cross correlation between Eit Environmental Development and Shanghai Pudong Development, you can compare the effects of market volatilities on Eit Environmental and Shanghai Pudong 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 Eit Environmental with a short position of Shanghai Pudong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eit Environmental and Shanghai Pudong.
Diversification Opportunities for Eit Environmental and Shanghai Pudong
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Eit and Shanghai is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Eit Environmental Development and Shanghai Pudong Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Pudong Deve and Eit Environmental 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 Eit Environmental Development are associated (or correlated) with Shanghai Pudong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Pudong Deve has no effect on the direction of Eit Environmental i.e., Eit Environmental and Shanghai Pudong go up and down completely randomly.
Pair Corralation between Eit Environmental and Shanghai Pudong
Assuming the 90 days trading horizon Eit Environmental Development is expected to generate 2.65 times more return on investment than Shanghai Pudong. However, Eit Environmental is 2.65 times more volatile than Shanghai Pudong Development. It trades about 0.0 of its potential returns per unit of risk. Shanghai Pudong Development is currently generating about -0.22 per unit of risk. If you would invest 1,549 in Eit Environmental Development on August 29, 2024 and sell it today you would lose (32.00) from holding Eit Environmental Development or give up 2.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eit Environmental Development vs. Shanghai Pudong Development
Performance |
| Timeline |
| Eit Environmental |
| Shanghai Pudong Deve |
Eit Environmental and Shanghai Pudong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eit Environmental and Shanghai Pudong
The main advantage of trading using opposite Eit Environmental and Shanghai Pudong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eit Environmental position performs unexpectedly, Shanghai Pudong 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 Shanghai Pudong will offset losses from the drop in Shanghai Pudong's long position.| Eit Environmental vs. PetroChina Co Ltd | Eit Environmental vs. China State Construction | Eit Environmental vs. China Mobile Limited | Eit Environmental vs. Industrial and Commercial |
| Shanghai Pudong vs. Hang Xiao Steel | Shanghai Pudong vs. Gansu Jiu Steel | Shanghai Pudong vs. Tianjin Capital Environmental | Shanghai Pudong vs. Eit Environmental Development |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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