Correlation Between Shenzhen and Qingdao Foods
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By analyzing existing cross correlation between Shenzhen AV Display Co and Qingdao Foods Co, you can compare the effects of market volatilities on Shenzhen and Qingdao Foods 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 with a short position of Qingdao Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen and Qingdao Foods.
Diversification Opportunities for Shenzhen and Qingdao Foods
0.54 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shenzhen and Qingdao is 0.54. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen AV Display Co and Qingdao Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qingdao Foods and Shenzhen 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 AV Display Co are associated (or correlated) with Qingdao Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qingdao Foods has no effect on the direction of Shenzhen i.e., Shenzhen and Qingdao Foods go up and down completely randomly.
Pair Corralation between Shenzhen and Qingdao Foods
Assuming the 90 days trading horizon Shenzhen AV Display Co is expected to generate 1.57 times more return on investment than Qingdao Foods. However, Shenzhen is 1.57 times more volatile than Qingdao Foods Co. It trades about 0.02 of its potential returns per unit of risk. Qingdao Foods Co is currently generating about 0.0 per unit of risk. If you would invest 2,976 in Shenzhen AV Display Co on October 14, 2024 and sell it today you would lose (75.00) from holding Shenzhen AV Display Co or give up 2.52% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen AV Display Co vs. Qingdao Foods Co
Performance |
| Timeline |
| Shenzhen AV Display |
| Qingdao Foods |
Shenzhen and Qingdao Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen and Qingdao Foods
The main advantage of trading using opposite Shenzhen and Qingdao Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen position performs unexpectedly, Qingdao Foods 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 Qingdao Foods will offset losses from the drop in Qingdao Foods' long position.| Shenzhen vs. Guangdong Marubi Biotechnology | Shenzhen vs. Anhui Huaheng Biotechnology | Shenzhen vs. Yili Chuanning Biotechnology | Shenzhen vs. Shenzhen Bioeasy Biotechnology |
| Qingdao Foods vs. Shenzhen AV Display Co | Qingdao Foods vs. Anji Foodstuff Co | Qingdao Foods vs. Muyuan Foodstuff Co | Qingdao Foods vs. Anshan Senyuan Road |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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