Correlation Between Beijing Sanyuan and Zhongyin Babi
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By analyzing existing cross correlation between Beijing Sanyuan Foods and Zhongyin Babi Food, you can compare the effects of market volatilities on Beijing Sanyuan and Zhongyin Babi 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 Zhongyin Babi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Sanyuan and Zhongyin Babi.
Diversification Opportunities for Beijing Sanyuan and Zhongyin Babi
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Beijing and Zhongyin is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Sanyuan Foods and Zhongyin Babi Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongyin Babi Food 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 Zhongyin Babi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongyin Babi Food has no effect on the direction of Beijing Sanyuan i.e., Beijing Sanyuan and Zhongyin Babi go up and down completely randomly.
Pair Corralation between Beijing Sanyuan and Zhongyin Babi
Assuming the 90 days trading horizon Beijing Sanyuan Foods is expected to generate 0.82 times more return on investment than Zhongyin Babi. However, Beijing Sanyuan Foods is 1.21 times less risky than Zhongyin Babi. It trades about 0.01 of its potential returns per unit of risk. Zhongyin Babi Food is currently generating about -0.02 per unit of risk. If you would invest 440.00 in Beijing Sanyuan Foods on August 29, 2024 and sell it today you would earn a total of 0.00 from holding Beijing Sanyuan Foods or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Sanyuan Foods vs. Zhongyin Babi Food
Performance |
| Timeline |
| Beijing Sanyuan Foods |
| Zhongyin Babi Food |
Beijing Sanyuan and Zhongyin Babi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Sanyuan and Zhongyin Babi
The main advantage of trading using opposite Beijing Sanyuan and Zhongyin Babi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Sanyuan position performs unexpectedly, Zhongyin Babi 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 Zhongyin Babi will offset losses from the drop in Zhongyin Babi's long position.| Beijing Sanyuan vs. China Petroleum Chemical | Beijing Sanyuan vs. PetroChina Co Ltd | Beijing Sanyuan vs. China State Construction | Beijing Sanyuan vs. China Railway Group |
| Zhongyin Babi vs. China Petroleum Chemical | Zhongyin Babi vs. PetroChina Co Ltd | Zhongyin Babi vs. China State Construction | Zhongyin Babi vs. China Railway Group |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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