Correlation Between Shanghai Construction and Taiji Computer
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By analyzing existing cross correlation between Shanghai Construction Group and Taiji Computer Corp, you can compare the effects of market volatilities on Shanghai Construction and Taiji Computer 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 Taiji Computer. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Construction and Taiji Computer.
Diversification Opportunities for Shanghai Construction and Taiji Computer
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shanghai and Taiji is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Construction Group and Taiji Computer Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Taiji Computer Corp 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 Taiji Computer. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Taiji Computer Corp has no effect on the direction of Shanghai Construction i.e., Shanghai Construction and Taiji Computer go up and down completely randomly.
Pair Corralation between Shanghai Construction and Taiji Computer
Assuming the 90 days trading horizon Shanghai Construction Group is expected to generate 0.62 times more return on investment than Taiji Computer. However, Shanghai Construction Group is 1.62 times less risky than Taiji Computer. It trades about -0.5 of its potential returns per unit of risk. Taiji Computer Corp is currently generating about -0.42 per unit of risk. If you would invest 280.00 in Shanghai Construction Group on October 14, 2024 and sell it today you would lose (37.00) from holding Shanghai Construction Group or give up 13.21% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Construction Group vs. Taiji Computer Corp
Performance |
| Timeline |
| Shanghai Construction |
| Taiji Computer Corp |
Shanghai Construction and Taiji Computer Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Construction and Taiji Computer
The main advantage of trading using opposite Shanghai Construction and Taiji Computer positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Construction position performs unexpectedly, Taiji Computer 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 Taiji Computer will offset losses from the drop in Taiji Computer's long position.| Shanghai Construction vs. Agricultural Bank of | Shanghai Construction vs. Industrial and Commercial | Shanghai Construction vs. Bank of China | Shanghai Construction vs. PetroChina Co Ltd |
| Taiji Computer vs. Jiangsu Jinling Sports | Taiji Computer vs. Nanxing Furniture Machinery | Taiji Computer vs. Dazhong Transportation Group | Taiji Computer vs. Shaanxi Construction 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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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