Correlation Between ShuYu Civilian and Huaneng Lancang
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By analyzing existing cross correlation between ShuYu Civilian Pharmacy and Huaneng Lancang River, you can compare the effects of market volatilities on ShuYu Civilian and Huaneng Lancang 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 ShuYu Civilian with a short position of Huaneng Lancang. Check out your portfolio center. Please also check ongoing floating volatility patterns of ShuYu Civilian and Huaneng Lancang.
Diversification Opportunities for ShuYu Civilian and Huaneng Lancang
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between ShuYu and Huaneng is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding ShuYu Civilian Pharmacy and Huaneng Lancang River in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huaneng Lancang River and ShuYu Civilian 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 ShuYu Civilian Pharmacy are associated (or correlated) with Huaneng Lancang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huaneng Lancang River has no effect on the direction of ShuYu Civilian i.e., ShuYu Civilian and Huaneng Lancang go up and down completely randomly.
Pair Corralation between ShuYu Civilian and Huaneng Lancang
Assuming the 90 days trading horizon ShuYu Civilian Pharmacy is expected to under-perform the Huaneng Lancang. In addition to that, ShuYu Civilian is 1.88 times more volatile than Huaneng Lancang River. It trades about -0.07 of its total potential returns per unit of risk. Huaneng Lancang River is currently generating about -0.11 per unit of volatility. If you would invest 922.00 in Huaneng Lancang River on November 7, 2024 and sell it today you would lose (18.00) from holding Huaneng Lancang River or give up 1.95% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ShuYu Civilian Pharmacy vs. Huaneng Lancang River
Performance |
| Timeline |
| ShuYu Civilian Pharmacy |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Huaneng Lancang River |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
ShuYu Civilian and Huaneng Lancang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ShuYu Civilian and Huaneng Lancang
The main advantage of trading using opposite ShuYu Civilian and Huaneng Lancang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ShuYu Civilian position performs unexpectedly, Huaneng Lancang 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 Huaneng Lancang will offset losses from the drop in Huaneng Lancang's long position.The idea behind ShuYu Civilian Pharmacy and Huaneng Lancang River pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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