Correlation Between Sany Heavy and Shenyang Chemical
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By analyzing existing cross correlation between Sany Heavy Industry and Shenyang Chemical Industry, you can compare the effects of market volatilities on Sany Heavy and Shenyang Chemical 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 Sany Heavy with a short position of Shenyang Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sany Heavy and Shenyang Chemical.
Diversification Opportunities for Sany Heavy and Shenyang Chemical
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Sany and Shenyang is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Sany Heavy Industry and Shenyang Chemical Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenyang Chemical and Sany Heavy 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 Sany Heavy Industry are associated (or correlated) with Shenyang Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenyang Chemical has no effect on the direction of Sany Heavy i.e., Sany Heavy and Shenyang Chemical go up and down completely randomly.
Pair Corralation between Sany Heavy and Shenyang Chemical
Assuming the 90 days trading horizon Sany Heavy is expected to generate 1.66 times less return on investment than Shenyang Chemical. But when comparing it to its historical volatility, Sany Heavy Industry is 1.39 times less risky than Shenyang Chemical. It trades about 0.05 of its potential returns per unit of risk. Shenyang Chemical Industry is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 325.00 in Shenyang Chemical Industry on September 3, 2024 and sell it today you would earn a total of 53.00 from holding Shenyang Chemical Industry or generate 16.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sany Heavy Industry vs. Shenyang Chemical Industry
Performance |
| Timeline |
| Sany Heavy Industry |
| Shenyang Chemical |
Sany Heavy and Shenyang Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sany Heavy and Shenyang Chemical
The main advantage of trading using opposite Sany Heavy and Shenyang Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sany Heavy position performs unexpectedly, Shenyang Chemical 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 Shenyang Chemical will offset losses from the drop in Shenyang Chemical's long position.| Sany Heavy vs. Digital China Information | Sany Heavy vs. Offshore Oil Engineering | Sany Heavy vs. Fiberhome Telecommunication Technologies | Sany Heavy vs. Jonjee Hi tech Industrial |
| Shenyang Chemical vs. Zijin Mining Group | Shenyang Chemical vs. Baoshan Iron Steel | Shenyang Chemical vs. Hoshine Silicon Ind |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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