Correlation Between Liuzhou Chemical and Shanghai Rongtai
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By analyzing existing cross correlation between Liuzhou Chemical Industry and Shanghai Rongtai Health, you can compare the effects of market volatilities on Liuzhou Chemical and Shanghai Rongtai 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 Liuzhou Chemical with a short position of Shanghai Rongtai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liuzhou Chemical and Shanghai Rongtai.
Diversification Opportunities for Liuzhou Chemical and Shanghai Rongtai
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Liuzhou and Shanghai is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Liuzhou Chemical Industry and Shanghai Rongtai Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Rongtai Health and Liuzhou 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 Liuzhou Chemical Industry are associated (or correlated) with Shanghai Rongtai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Rongtai Health has no effect on the direction of Liuzhou Chemical i.e., Liuzhou Chemical and Shanghai Rongtai go up and down completely randomly.
Pair Corralation between Liuzhou Chemical and Shanghai Rongtai
Assuming the 90 days trading horizon Liuzhou Chemical Industry is expected to generate 1.03 times more return on investment than Shanghai Rongtai. However, Liuzhou Chemical is 1.03 times more volatile than Shanghai Rongtai Health. It trades about 0.0 of its potential returns per unit of risk. Shanghai Rongtai Health is currently generating about -0.02 per unit of risk. If you would invest 360.00 in Liuzhou Chemical Industry on August 29, 2024 and sell it today you would lose (58.00) from holding Liuzhou Chemical Industry or give up 16.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Liuzhou Chemical Industry vs. Shanghai Rongtai Health
Performance |
| Timeline |
| Liuzhou Chemical Industry |
| Shanghai Rongtai Health |
Liuzhou Chemical and Shanghai Rongtai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liuzhou Chemical and Shanghai Rongtai
The main advantage of trading using opposite Liuzhou Chemical and Shanghai Rongtai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liuzhou Chemical position performs unexpectedly, Shanghai Rongtai 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 Rongtai will offset losses from the drop in Shanghai Rongtai's long position.| Liuzhou Chemical vs. Zijin Mining Group | Liuzhou Chemical vs. Wanhua Chemical Group | Liuzhou Chemical vs. Baoshan Iron Steel | Liuzhou Chemical vs. Shandong Gold Mining |
| Shanghai Rongtai vs. Shenzhen MYS Environmental | Shanghai Rongtai vs. AVIC Fund Management | Shanghai Rongtai vs. Shenzhen Bingchuan Network | Shanghai Rongtai vs. Penghua Shenzhen Energy |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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