Correlation Between Shandong Sanyuan and Jiangsu Yueda
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By analyzing existing cross correlation between Shandong Sanyuan Biotechnology and Jiangsu Yueda Investment, you can compare the effects of market volatilities on Shandong Sanyuan and Jiangsu Yueda 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 Shandong Sanyuan with a short position of Jiangsu Yueda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Sanyuan and Jiangsu Yueda.
Diversification Opportunities for Shandong Sanyuan and Jiangsu Yueda
0.66 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shandong and Jiangsu is 0.66. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Sanyuan Biotechnology and Jiangsu Yueda Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Yueda Investment and Shandong Sanyuan 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 Shandong Sanyuan Biotechnology are associated (or correlated) with Jiangsu Yueda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Yueda Investment has no effect on the direction of Shandong Sanyuan i.e., Shandong Sanyuan and Jiangsu Yueda go up and down completely randomly.
Pair Corralation between Shandong Sanyuan and Jiangsu Yueda
Assuming the 90 days trading horizon Shandong Sanyuan Biotechnology is expected to generate 0.94 times more return on investment than Jiangsu Yueda. However, Shandong Sanyuan Biotechnology is 1.07 times less risky than Jiangsu Yueda. It trades about 0.03 of its potential returns per unit of risk. Jiangsu Yueda Investment is currently generating about 0.02 per unit of risk. If you would invest 2,377 in Shandong Sanyuan Biotechnology on October 25, 2024 and sell it today you would earn a total of 209.00 from holding Shandong Sanyuan Biotechnology or generate 8.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Sanyuan Biotechnology vs. Jiangsu Yueda Investment
Performance |
| Timeline |
| Shandong Sanyuan Bio |
| Jiangsu Yueda Investment |
Shandong Sanyuan and Jiangsu Yueda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Sanyuan and Jiangsu Yueda
The main advantage of trading using opposite Shandong Sanyuan and Jiangsu Yueda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Sanyuan position performs unexpectedly, Jiangsu Yueda 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 Jiangsu Yueda will offset losses from the drop in Jiangsu Yueda's long position.| Shandong Sanyuan vs. Agricultural Bank of | Shandong Sanyuan vs. Postal Savings Bank | Shandong Sanyuan vs. Bank of Communications | Shandong Sanyuan vs. China Merchants Bank |
| Jiangsu Yueda vs. Kweichow Moutai Co | Jiangsu Yueda vs. Contemporary Amperex Technology | Jiangsu Yueda vs. Beijing Roborock Technology | Jiangsu Yueda vs. BYD Co Ltd |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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