Correlation Between Beijing Tiantan and Shanghai Shuixing
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By analyzing existing cross correlation between Beijing Tiantan Biological and Shanghai Shuixing Home, you can compare the effects of market volatilities on Beijing Tiantan and Shanghai Shuixing 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 Beijing Tiantan with a short position of Shanghai Shuixing. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Tiantan and Shanghai Shuixing.
Diversification Opportunities for Beijing Tiantan and Shanghai Shuixing
-0.64 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Beijing and Shanghai is -0.64. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Tiantan Biological and Shanghai Shuixing Home in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Shuixing Home and Beijing Tiantan 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 Beijing Tiantan Biological are associated (or correlated) with Shanghai Shuixing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Shuixing Home has no effect on the direction of Beijing Tiantan i.e., Beijing Tiantan and Shanghai Shuixing go up and down completely randomly.
Pair Corralation between Beijing Tiantan and Shanghai Shuixing
Assuming the 90 days trading horizon Beijing Tiantan Biological is expected to under-perform the Shanghai Shuixing. But the stock apears to be less risky and, when comparing its historical volatility, Beijing Tiantan Biological is 1.08 times less risky than Shanghai Shuixing. The stock trades about -0.01 of its potential returns per unit of risk. The Shanghai Shuixing Home is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 1,318 in Shanghai Shuixing Home on October 9, 2024 and sell it today you would earn a total of 450.00 from holding Shanghai Shuixing Home or generate 34.14% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Tiantan Biological vs. Shanghai Shuixing Home
Performance |
| Timeline |
| Beijing Tiantan Biol |
| Shanghai Shuixing Home |
Beijing Tiantan and Shanghai Shuixing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Tiantan and Shanghai Shuixing
The main advantage of trading using opposite Beijing Tiantan and Shanghai Shuixing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Tiantan position performs unexpectedly, Shanghai Shuixing 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 Shuixing will offset losses from the drop in Shanghai Shuixing's long position.| Beijing Tiantan vs. Northking Information Technology | Beijing Tiantan vs. Tianshui Huatian Technology | Beijing Tiantan vs. Tianjin Ruixin Technology | Beijing Tiantan vs. Soyea Technology Co |
| Shanghai Shuixing vs. Ningxia Building Materials | Shanghai Shuixing vs. Vats Liquor Chain | Shanghai Shuixing vs. MayAir Technology Co | Shanghai Shuixing vs. Sunny Loan Top |
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 Global Markets Map module to get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes.
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