Correlation Between Shanghai Construction and Runjian Communication
Specify exactly 2 symbols:
By analyzing existing cross correlation between Shanghai Construction Group and Runjian Communication Co, you can compare the effects of market volatilities on Shanghai Construction and Runjian Communication 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 Runjian Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Construction and Runjian Communication.
Diversification Opportunities for Shanghai Construction and Runjian Communication
0.09 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Shanghai and Runjian is 0.09. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Construction Group and Runjian Communication Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Runjian Communication 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 Runjian Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Runjian Communication has no effect on the direction of Shanghai Construction i.e., Shanghai Construction and Runjian Communication go up and down completely randomly.
Pair Corralation between Shanghai Construction and Runjian Communication
Assuming the 90 days trading horizon Shanghai Construction Group is expected to under-perform the Runjian Communication. But the stock apears to be less risky and, when comparing its historical volatility, Shanghai Construction Group is 2.27 times less risky than Runjian Communication. The stock trades about -0.08 of its potential returns per unit of risk. The Runjian Communication Co is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 2,974 in Runjian Communication Co on November 7, 2024 and sell it today you would earn a total of 238.00 from holding Runjian Communication Co or generate 8.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Construction Group vs. Runjian Communication Co
Performance |
| Timeline |
| Shanghai Construction |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Runjian Communication |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
Shanghai Construction and Runjian Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Construction and Runjian Communication
The main advantage of trading using opposite Shanghai Construction and Runjian Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Construction position performs unexpectedly, Runjian Communication 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 Runjian Communication will offset losses from the drop in Runjian Communication's long position.The idea behind Shanghai Construction Group and Runjian Communication Co pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
Other Complementary Tools
| Competition Analyzer Analyze and compare many basic indicators for a group of related or unrelated entities | |
| Portfolio Analyzer Portfolio analysis module that provides access to portfolio diagnostics and optimization engine | |
| Price Ceiling Movement Calculate and plot Price Ceiling Movement for different equity instruments | |
| Global Correlations Find global opportunities by holding instruments from different markets | |
| Sign In To Macroaxis Sign in to explore Macroaxis' wealth optimization platform and fintech modules |