Correlation Between Long Yuan and Shenyang Huitian
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By analyzing existing cross correlation between Long Yuan Construction and Shenyang Huitian Thermal, you can compare the effects of market volatilities on Long Yuan and Shenyang Huitian 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 Long Yuan with a short position of Shenyang Huitian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Long Yuan and Shenyang Huitian.
Diversification Opportunities for Long Yuan and Shenyang Huitian
0.72 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Long and Shenyang is 0.72. Overlapping area represents the amount of risk that can be diversified away by holding Long Yuan Construction and Shenyang Huitian Thermal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenyang Huitian Thermal and Long Yuan 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 Long Yuan Construction are associated (or correlated) with Shenyang Huitian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenyang Huitian Thermal has no effect on the direction of Long Yuan i.e., Long Yuan and Shenyang Huitian go up and down completely randomly.
Pair Corralation between Long Yuan and Shenyang Huitian
Assuming the 90 days trading horizon Long Yuan Construction is expected to under-perform the Shenyang Huitian. But the stock apears to be less risky and, when comparing its historical volatility, Long Yuan Construction is 1.06 times less risky than Shenyang Huitian. The stock trades about -0.03 of its potential returns per unit of risk. The Shenyang Huitian Thermal is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 329.00 in Shenyang Huitian Thermal on October 16, 2024 and sell it today you would lose (8.00) from holding Shenyang Huitian Thermal or give up 2.43% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.58% |
| Values | Daily Returns |
Long Yuan Construction vs. Shenyang Huitian Thermal
Performance |
| Timeline |
| Long Yuan Construction |
| Shenyang Huitian Thermal |
Long Yuan and Shenyang Huitian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Long Yuan and Shenyang Huitian
The main advantage of trading using opposite Long Yuan and Shenyang Huitian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Long Yuan position performs unexpectedly, Shenyang Huitian 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 Shenyang Huitian will offset losses from the drop in Shenyang Huitian's long position.| Long Yuan vs. Anhui Xinhua Media | Long Yuan vs. Longjian Road Bridge | Long Yuan vs. Heilongjiang Transport Development | Long Yuan vs. Shuhua Sports Co |
| Shenyang Huitian vs. Longmaster Information Tech | Shenyang Huitian vs. Invengo Information Technology | Shenyang Huitian vs. Wonders Information | Shenyang Huitian vs. Songz Automobile Air |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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