Correlation Between Wuhan Yangtze and Shanghai Sanyou
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By analyzing existing cross correlation between Wuhan Yangtze Communication and Shanghai Sanyou Medical, you can compare the effects of market volatilities on Wuhan Yangtze and Shanghai Sanyou 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 Wuhan Yangtze with a short position of Shanghai Sanyou. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wuhan Yangtze and Shanghai Sanyou.
Diversification Opportunities for Wuhan Yangtze and Shanghai Sanyou
0.37 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Wuhan and Shanghai is 0.37. Overlapping area represents the amount of risk that can be diversified away by holding Wuhan Yangtze Communication and Shanghai Sanyou Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Sanyou Medical and Wuhan Yangtze 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 Wuhan Yangtze Communication are associated (or correlated) with Shanghai Sanyou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Sanyou Medical has no effect on the direction of Wuhan Yangtze i.e., Wuhan Yangtze and Shanghai Sanyou go up and down completely randomly.
Pair Corralation between Wuhan Yangtze and Shanghai Sanyou
Assuming the 90 days trading horizon Wuhan Yangtze Communication is expected to under-perform the Shanghai Sanyou. But the stock apears to be less risky and, when comparing its historical volatility, Wuhan Yangtze Communication is 1.32 times less risky than Shanghai Sanyou. The stock trades about -0.17 of its potential returns per unit of risk. The Shanghai Sanyou Medical is currently generating about -0.07 of returns per unit of risk over similar time horizon. If you would invest 1,962 in Shanghai Sanyou Medical on October 25, 2024 and sell it today you would lose (110.00) from holding Shanghai Sanyou Medical or give up 5.61% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wuhan Yangtze Communication vs. Shanghai Sanyou Medical
Performance |
| Timeline |
| Wuhan Yangtze Commun |
| Shanghai Sanyou Medical |
Wuhan Yangtze and Shanghai Sanyou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wuhan Yangtze and Shanghai Sanyou
The main advantage of trading using opposite Wuhan Yangtze and Shanghai Sanyou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wuhan Yangtze position performs unexpectedly, Shanghai Sanyou 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 Shanghai Sanyou will offset losses from the drop in Shanghai Sanyou's long position.| Wuhan Yangtze vs. Kweichow Moutai Co | Wuhan Yangtze vs. NAURA Technology Group | Wuhan Yangtze vs. APT Medical | Wuhan Yangtze vs. BYD Co Ltd |
| Shanghai Sanyou vs. Agricultural Bank of | Shanghai Sanyou vs. Industrial and Commercial | Shanghai Sanyou vs. Bank of China | Shanghai Sanyou vs. China Construction Bank |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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