Correlation Between Wanhua Chemical and Shenzhen MYS
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By analyzing existing cross correlation between Wanhua Chemical Group and Shenzhen MYS Environmental, you can compare the effects of market volatilities on Wanhua Chemical and Shenzhen MYS 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 Wanhua Chemical with a short position of Shenzhen MYS. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wanhua Chemical and Shenzhen MYS.
Diversification Opportunities for Wanhua Chemical and Shenzhen MYS
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Wanhua and Shenzhen is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Wanhua Chemical Group and Shenzhen MYS Environmental in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen MYS Environ and Wanhua Chemical 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 Wanhua Chemical Group are associated (or correlated) with Shenzhen MYS. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen MYS Environ has no effect on the direction of Wanhua Chemical i.e., Wanhua Chemical and Shenzhen MYS go up and down completely randomly.
Pair Corralation between Wanhua Chemical and Shenzhen MYS
Assuming the 90 days trading horizon Wanhua Chemical Group is expected to under-perform the Shenzhen MYS. But the stock apears to be less risky and, when comparing its historical volatility, Wanhua Chemical Group is 1.65 times less risky than Shenzhen MYS. The stock trades about -0.12 of its potential returns per unit of risk. The Shenzhen MYS Environmental is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 319.00 in Shenzhen MYS Environmental on November 5, 2024 and sell it today you would earn a total of 21.00 from holding Shenzhen MYS Environmental or generate 6.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wanhua Chemical Group vs. Shenzhen MYS Environmental
Performance |
| Timeline |
| Wanhua Chemical Group |
| Shenzhen MYS Environ |
Wanhua Chemical and Shenzhen MYS Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wanhua Chemical and Shenzhen MYS
The main advantage of trading using opposite Wanhua Chemical and Shenzhen MYS positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wanhua Chemical position performs unexpectedly, Shenzhen MYS 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 Shenzhen MYS will offset losses from the drop in Shenzhen MYS's long position.| Wanhua Chemical vs. Namchow Food Group | Wanhua Chemical vs. Jiajia Food Group | Wanhua Chemical vs. Anji Foodstuff Co | Wanhua Chemical vs. Guilin Seamild Foods |
| Shenzhen MYS vs. Zijin Mining Group | Shenzhen MYS vs. Wanhua Chemical Group | Shenzhen MYS vs. Baoshan Iron Steel | Shenzhen MYS vs. Shandong Gold Mining |
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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