Correlation Between Beijing Sanyuan and Qingdao Rural
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By analyzing existing cross correlation between Beijing Sanyuan Foods and Qingdao Rural Commercial, you can compare the effects of market volatilities on Beijing Sanyuan and Qingdao Rural 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 Beijing Sanyuan with a short position of Qingdao Rural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Sanyuan and Qingdao Rural.
Diversification Opportunities for Beijing Sanyuan and Qingdao Rural
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Beijing and Qingdao is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Sanyuan Foods and Qingdao Rural Commercial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qingdao Rural Commercial and Beijing Sanyuan 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 Beijing Sanyuan Foods are associated (or correlated) with Qingdao Rural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qingdao Rural Commercial has no effect on the direction of Beijing Sanyuan i.e., Beijing Sanyuan and Qingdao Rural go up and down completely randomly.
Pair Corralation between Beijing Sanyuan and Qingdao Rural
Assuming the 90 days trading horizon Beijing Sanyuan Foods is expected to under-perform the Qingdao Rural. In addition to that, Beijing Sanyuan is 1.17 times more volatile than Qingdao Rural Commercial. It trades about -0.02 of its total potential returns per unit of risk. Qingdao Rural Commercial is currently generating about 0.02 per unit of volatility. If you would invest 288.00 in Qingdao Rural Commercial on September 4, 2024 and sell it today you would earn a total of 23.00 from holding Qingdao Rural Commercial or generate 7.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.79% |
| Values | Daily Returns |
Beijing Sanyuan Foods vs. Qingdao Rural Commercial
Performance |
| Timeline |
| Beijing Sanyuan Foods |
| Qingdao Rural Commercial |
Beijing Sanyuan and Qingdao Rural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Sanyuan and Qingdao Rural
The main advantage of trading using opposite Beijing Sanyuan and Qingdao Rural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Sanyuan position performs unexpectedly, Qingdao Rural 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 Qingdao Rural will offset losses from the drop in Qingdao Rural's long position.| Beijing Sanyuan vs. Sportsoul Co Ltd | Beijing Sanyuan vs. Lander Sports Development | Beijing Sanyuan vs. Jiangsu Jinling Sports | Beijing Sanyuan vs. Luolai Home Textile |
| Qingdao Rural vs. Jiangnan Mould Plastic | Qingdao Rural vs. Ningbo Tip Rubber | Qingdao Rural vs. Suzhou Xingye Material | Qingdao Rural vs. Dongguan Aohai Technology |
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 Price Ceiling Movement module to calculate and plot Price Ceiling Movement for different equity instruments.
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