Correlation Between Shenzhen Bioeasy and Sichuan Yahua
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By analyzing existing cross correlation between Shenzhen Bioeasy Biotechnology and Sichuan Yahua Industrial, you can compare the effects of market volatilities on Shenzhen Bioeasy and Sichuan Yahua 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 Bioeasy with a short position of Sichuan Yahua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Bioeasy and Sichuan Yahua.
Diversification Opportunities for Shenzhen Bioeasy and Sichuan Yahua
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shenzhen and Sichuan is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Bioeasy Biotechnology and Sichuan Yahua Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sichuan Yahua Industrial and Shenzhen Bioeasy 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 Bioeasy Biotechnology are associated (or correlated) with Sichuan Yahua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sichuan Yahua Industrial has no effect on the direction of Shenzhen Bioeasy i.e., Shenzhen Bioeasy and Sichuan Yahua go up and down completely randomly.
Pair Corralation between Shenzhen Bioeasy and Sichuan Yahua
Assuming the 90 days trading horizon Shenzhen Bioeasy Biotechnology is expected to generate 1.52 times more return on investment than Sichuan Yahua. However, Shenzhen Bioeasy is 1.52 times more volatile than Sichuan Yahua Industrial. It trades about -0.01 of its potential returns per unit of risk. Sichuan Yahua Industrial is currently generating about -0.02 per unit of risk. If you would invest 1,210 in Shenzhen Bioeasy Biotechnology on October 16, 2024 and sell it today you would lose (425.00) from holding Shenzhen Bioeasy Biotechnology or give up 35.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Bioeasy Biotechnology vs. Sichuan Yahua Industrial
Performance |
| Timeline |
| Shenzhen Bioeasy Bio |
| Sichuan Yahua Industrial |
Shenzhen Bioeasy and Sichuan Yahua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Bioeasy and Sichuan Yahua
The main advantage of trading using opposite Shenzhen Bioeasy and Sichuan Yahua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Bioeasy position performs unexpectedly, Sichuan Yahua 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 Sichuan Yahua will offset losses from the drop in Sichuan Yahua's long position.| Shenzhen Bioeasy vs. Shandong Longda Meat | Shenzhen Bioeasy vs. Guilin Seamild Foods | Shenzhen Bioeasy vs. Juewei Food Co | Shenzhen Bioeasy vs. JuneYao Dairy Co |
| Sichuan Yahua vs. Shenzhen Bioeasy Biotechnology | Sichuan Yahua vs. Heilongjiang Publishing Media | Sichuan Yahua vs. Southern PublishingMedia Co | Sichuan Yahua vs. Changchun BCHT Biotechnology |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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