Correlation Between Wanhua Chemical and Yingde Greatchem
Specify exactly 2 symbols:
By analyzing existing cross correlation between Wanhua Chemical Group and Yingde Greatchem Chemicals, you can compare the effects of market volatilities on Wanhua Chemical and Yingde Greatchem 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 Yingde Greatchem. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wanhua Chemical and Yingde Greatchem.
Diversification Opportunities for Wanhua Chemical and Yingde Greatchem
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Wanhua and Yingde is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Wanhua Chemical Group and Yingde Greatchem Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yingde Greatchem Che 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 Yingde Greatchem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yingde Greatchem Che has no effect on the direction of Wanhua Chemical i.e., Wanhua Chemical and Yingde Greatchem go up and down completely randomly.
Pair Corralation between Wanhua Chemical and Yingde Greatchem
Assuming the 90 days trading horizon Wanhua Chemical Group is expected to under-perform the Yingde Greatchem. But the stock apears to be less risky and, when comparing its historical volatility, Wanhua Chemical Group is 1.41 times less risky than Yingde Greatchem. The stock trades about -0.23 of its potential returns per unit of risk. The Yingde Greatchem Chemicals is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest 2,536 in Yingde Greatchem Chemicals on August 29, 2024 and sell it today you would lose (57.00) from holding Yingde Greatchem Chemicals or give up 2.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wanhua Chemical Group vs. Yingde Greatchem Chemicals
Performance |
| Timeline |
| Wanhua Chemical Group |
| Yingde Greatchem Che |
Wanhua Chemical and Yingde Greatchem Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wanhua Chemical and Yingde Greatchem
The main advantage of trading using opposite Wanhua Chemical and Yingde Greatchem positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wanhua Chemical position performs unexpectedly, Yingde Greatchem 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 Yingde Greatchem will offset losses from the drop in Yingde Greatchem's long position.| Wanhua Chemical vs. Chongqing Changan Automobile | Wanhua Chemical vs. Guangdong Shenglu Telecommunication | Wanhua Chemical vs. Tongyu Communication | Wanhua Chemical vs. Sinomach Automobile Co |
| Yingde Greatchem vs. Xingguang Agricultural Mach | Yingde Greatchem vs. Anhui Deli Household | Yingde Greatchem vs. Long Yuan Construction | Yingde Greatchem vs. Lutian Machinery Co |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
Other Complementary Tools
| Premium Stories Follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Global Markets Map Get a quick overview of global market snapshot using zoomable world map. Drill down to check world indexes | |
| Idea Optimizer Use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |