Correlation Between Anhui Huaren and Shanghai Rongtai
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By analyzing existing cross correlation between Anhui Huaren Health and Shanghai Rongtai Health, you can compare the effects of market volatilities on Anhui Huaren and Shanghai Rongtai 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 Anhui Huaren with a short position of Shanghai Rongtai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Huaren and Shanghai Rongtai.
Diversification Opportunities for Anhui Huaren and Shanghai Rongtai
0.5 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Anhui and Shanghai is 0.5. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Huaren Health and Shanghai Rongtai Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Rongtai Health and Anhui Huaren 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 Anhui Huaren Health are associated (or correlated) with Shanghai Rongtai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Rongtai Health has no effect on the direction of Anhui Huaren i.e., Anhui Huaren and Shanghai Rongtai go up and down completely randomly.
Pair Corralation between Anhui Huaren and Shanghai Rongtai
Assuming the 90 days trading horizon Anhui Huaren Health is expected to under-perform the Shanghai Rongtai. In addition to that, Anhui Huaren is 1.24 times more volatile than Shanghai Rongtai Health. It trades about -0.05 of its total potential returns per unit of risk. Shanghai Rongtai Health is currently generating about -0.02 per unit of volatility. If you would invest 2,046 in Shanghai Rongtai Health on October 19, 2024 and sell it today you would lose (646.00) from holding Shanghai Rongtai Health or give up 31.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.44% |
| Values | Daily Returns |
Anhui Huaren Health vs. Shanghai Rongtai Health
Performance |
| Timeline |
| Anhui Huaren Health |
| Shanghai Rongtai Health |
Anhui Huaren and Shanghai Rongtai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Huaren and Shanghai Rongtai
The main advantage of trading using opposite Anhui Huaren and Shanghai Rongtai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Huaren position performs unexpectedly, Shanghai Rongtai 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 Shanghai Rongtai will offset losses from the drop in Shanghai Rongtai's long position.| Anhui Huaren vs. Tongyu Communication | Anhui Huaren vs. Anhui Jianghuai Automobile | Anhui Huaren vs. Fiberhome Telecommunication Technologies | Anhui Huaren vs. Guangxi Wuzhou Communications |
| Shanghai Rongtai vs. Ningxia Younglight Chemicals | Shanghai Rongtai vs. Jinhui Liquor Co | Shanghai Rongtai vs. Huasi Agricultural Development | Shanghai Rongtai vs. Weichai Heavy Machinery |
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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
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