Correlation Between Shenzhen Bioeasy and Shandong Rike
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By analyzing existing cross correlation between Shenzhen Bioeasy Biotechnology and Shandong Rike Chemical, you can compare the effects of market volatilities on Shenzhen Bioeasy and Shandong Rike 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 Shandong Rike. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen Bioeasy and Shandong Rike.
Diversification Opportunities for Shenzhen Bioeasy and Shandong Rike
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shenzhen and Shandong is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen Bioeasy Biotechnology and Shandong Rike Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Rike Chemical 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 Shandong Rike. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Rike Chemical has no effect on the direction of Shenzhen Bioeasy i.e., Shenzhen Bioeasy and Shandong Rike go up and down completely randomly.
Pair Corralation between Shenzhen Bioeasy and Shandong Rike
Assuming the 90 days trading horizon Shenzhen Bioeasy Biotechnology is expected to generate 0.8 times more return on investment than Shandong Rike. However, Shenzhen Bioeasy Biotechnology is 1.25 times less risky than Shandong Rike. It trades about -0.05 of its potential returns per unit of risk. Shandong Rike Chemical is currently generating about -0.06 per unit of risk. If you would invest 845.00 in Shenzhen Bioeasy Biotechnology on November 3, 2024 and sell it today you would lose (30.00) from holding Shenzhen Bioeasy Biotechnology or give up 3.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenzhen Bioeasy Biotechnology vs. Shandong Rike Chemical
Performance |
| Timeline |
| Shenzhen Bioeasy Bio |
| Shandong Rike Chemical |
Shenzhen Bioeasy and Shandong Rike Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen Bioeasy and Shandong Rike
The main advantage of trading using opposite Shenzhen Bioeasy and Shandong Rike positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen Bioeasy position performs unexpectedly, Shandong Rike 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 Shandong Rike will offset losses from the drop in Shandong Rike's long position.| Shenzhen Bioeasy vs. Kweichow Moutai Co | Shenzhen Bioeasy vs. G bits Network Technology | Shenzhen Bioeasy vs. Anhui Gujing Distillery | Shenzhen Bioeasy vs. Anhui Gujing Distillery |
| Shandong Rike vs. Mango Excellent Media | Shandong Rike vs. JCHX Mining Management | Shandong Rike vs. Duzhe Publishing Media | Shandong Rike vs. Shaanxi Meineng Clean |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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