Correlation Between Shanghai Pudong and Shenzhen Clou
Specify exactly 2 symbols:
By analyzing existing cross correlation between Shanghai Pudong Development and Shenzhen Clou Electronics, you can compare the effects of market volatilities on Shanghai Pudong and Shenzhen Clou 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 Shanghai Pudong with a short position of Shenzhen Clou. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Pudong and Shenzhen Clou.
Diversification Opportunities for Shanghai Pudong and Shenzhen Clou
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shanghai and Shenzhen is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Pudong Development and Shenzhen Clou Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Clou Electronics and Shanghai Pudong 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 Shanghai Pudong Development are associated (or correlated) with Shenzhen Clou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Clou Electronics has no effect on the direction of Shanghai Pudong i.e., Shanghai Pudong and Shenzhen Clou go up and down completely randomly.
Pair Corralation between Shanghai Pudong and Shenzhen Clou
Assuming the 90 days trading horizon Shanghai Pudong Development is expected to under-perform the Shenzhen Clou. But the stock apears to be less risky and, when comparing its historical volatility, Shanghai Pudong Development is 2.32 times less risky than Shenzhen Clou. The stock trades about -0.22 of its potential returns per unit of risk. The Shenzhen Clou Electronics is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 429.00 in Shenzhen Clou Electronics on August 29, 2024 and sell it today you would earn a total of 14.00 from holding Shenzhen Clou Electronics or generate 3.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Pudong Development vs. Shenzhen Clou Electronics
Performance |
| Timeline |
| Shanghai Pudong Deve |
| Shenzhen Clou Electronics |
Shanghai Pudong and Shenzhen Clou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Pudong and Shenzhen Clou
The main advantage of trading using opposite Shanghai Pudong and Shenzhen Clou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Pudong position performs unexpectedly, Shenzhen Clou 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 Shenzhen Clou will offset losses from the drop in Shenzhen Clou's long position.| Shanghai Pudong vs. Jiaozuo Wanfang Aluminum | Shanghai Pudong vs. Rising Nonferrous Metals | Shanghai Pudong vs. Zhongyin Babi Food | Shanghai Pudong vs. Xinjiang Tianrun Dairy |
| Shenzhen Clou vs. Harbin Hatou Investment | Shenzhen Clou vs. Jointo Energy Investment | Shenzhen Clou vs. Xian International Medical | Shenzhen Clou vs. Cofoe Medical Technology |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins | |
| Latest Portfolios Quick portfolio dashboard that showcases your latest portfolios |