Correlation Between Shanghai Construction and Jiangnan Mould
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By analyzing existing cross correlation between Shanghai Construction Group and Jiangnan Mould Plastic, you can compare the effects of market volatilities on Shanghai Construction and Jiangnan Mould 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 Construction with a short position of Jiangnan Mould. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Construction and Jiangnan Mould.
Diversification Opportunities for Shanghai Construction and Jiangnan Mould
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shanghai and Jiangnan is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Construction Group and Jiangnan Mould Plastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangnan Mould Plastic and Shanghai Construction 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 Construction Group are associated (or correlated) with Jiangnan Mould. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangnan Mould Plastic has no effect on the direction of Shanghai Construction i.e., Shanghai Construction and Jiangnan Mould go up and down completely randomly.
Pair Corralation between Shanghai Construction and Jiangnan Mould
Assuming the 90 days trading horizon Shanghai Construction Group is expected to under-perform the Jiangnan Mould. But the stock apears to be less risky and, when comparing its historical volatility, Shanghai Construction Group is 1.48 times less risky than Jiangnan Mould. The stock trades about -0.08 of its potential returns per unit of risk. The Jiangnan Mould Plastic is currently generating about 0.21 of returns per unit of risk over similar time horizon. If you would invest 654.00 in Jiangnan Mould Plastic on November 6, 2024 and sell it today you would earn a total of 37.00 from holding Jiangnan Mould Plastic or generate 5.66% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Construction Group vs. Jiangnan Mould Plastic
Performance |
| Timeline |
| Shanghai Construction |
| Jiangnan Mould Plastic |
Shanghai Construction and Jiangnan Mould Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Construction and Jiangnan Mould
The main advantage of trading using opposite Shanghai Construction and Jiangnan Mould positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Construction position performs unexpectedly, Jiangnan Mould 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 Jiangnan Mould will offset losses from the drop in Jiangnan Mould's long position.| Shanghai Construction vs. Beijing Baolande Software | Shanghai Construction vs. Anhui Gujing Distillery | Shanghai Construction vs. Servyou Software Group | Shanghai Construction vs. Jiangsu Financial Leasing |
| Jiangnan Mould vs. GRIPM Advanced Materials | Jiangnan Mould vs. Dezhan HealthCare Co | Jiangnan Mould vs. Yunnan Jianzhijia Health Chain | Jiangnan Mould vs. Advanced Technology Materials |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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