Correlation Between Hang Xiao and Shenzhen Bingchuan
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By analyzing existing cross correlation between Hang Xiao Steel and Shenzhen Bingchuan Network, you can compare the effects of market volatilities on Hang Xiao and Shenzhen Bingchuan 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 Hang Xiao with a short position of Shenzhen Bingchuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hang Xiao and Shenzhen Bingchuan.
Diversification Opportunities for Hang Xiao and Shenzhen Bingchuan
0.81 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hang and Shenzhen is 0.81. Overlapping area represents the amount of risk that can be diversified away by holding Hang Xiao Steel and Shenzhen Bingchuan Network in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Bingchuan and Hang Xiao 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 Hang Xiao Steel are associated (or correlated) with Shenzhen Bingchuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Bingchuan has no effect on the direction of Hang Xiao i.e., Hang Xiao and Shenzhen Bingchuan go up and down completely randomly.
Pair Corralation between Hang Xiao and Shenzhen Bingchuan
Assuming the 90 days trading horizon Hang Xiao Steel is expected to under-perform the Shenzhen Bingchuan. But the stock apears to be less risky and, when comparing its historical volatility, Hang Xiao Steel is 2.31 times less risky than Shenzhen Bingchuan. The stock trades about -0.07 of its potential returns per unit of risk. The Shenzhen Bingchuan Network is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 1,840 in Shenzhen Bingchuan Network on September 1, 2024 and sell it today you would earn a total of 493.00 from holding Shenzhen Bingchuan Network or generate 26.79% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hang Xiao Steel vs. Shenzhen Bingchuan Network
Performance |
| Timeline |
| Hang Xiao Steel |
| Shenzhen Bingchuan |
Hang Xiao and Shenzhen Bingchuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hang Xiao and Shenzhen Bingchuan
The main advantage of trading using opposite Hang Xiao and Shenzhen Bingchuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hang Xiao position performs unexpectedly, Shenzhen Bingchuan 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 Shenzhen Bingchuan will offset losses from the drop in Shenzhen Bingchuan's long position.| Hang Xiao vs. Western Metal Materials | Hang Xiao vs. Heilongjiang Transport Development | Hang Xiao vs. Dezhan HealthCare Co | Hang Xiao vs. Shanghai Rongtai Health |
| Shenzhen Bingchuan vs. Shenzhen MYS Environmental | Shenzhen Bingchuan vs. AVIC Fund Management | Shenzhen Bingchuan vs. Penghua Shenzhen Energy | Shenzhen Bingchuan vs. Jizhong Energy Resources |
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 Theme Ratings module to determine theme ratings based on digital equity recommendations. Macroaxis theme ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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