Correlation Between Long Yuan and Shanghai Yanpu
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By analyzing existing cross correlation between Long Yuan Construction and Shanghai Yanpu Metal, you can compare the effects of market volatilities on Long Yuan and Shanghai Yanpu 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 Shanghai Yanpu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Long Yuan and Shanghai Yanpu.
Diversification Opportunities for Long Yuan and Shanghai Yanpu
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Long and Shanghai is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Long Yuan Construction and Shanghai Yanpu Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Yanpu Metal 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 Shanghai Yanpu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Yanpu Metal has no effect on the direction of Long Yuan i.e., Long Yuan and Shanghai Yanpu go up and down completely randomly.
Pair Corralation between Long Yuan and Shanghai Yanpu
Assuming the 90 days trading horizon Long Yuan Construction is expected to generate 1.5 times more return on investment than Shanghai Yanpu. However, Long Yuan is 1.5 times more volatile than Shanghai Yanpu Metal. It trades about 0.01 of its potential returns per unit of risk. Shanghai Yanpu Metal is currently generating about -0.02 per unit of risk. If you would invest 399.00 in Long Yuan Construction on August 25, 2024 and sell it today you would lose (1.00) from holding Long Yuan Construction or give up 0.25% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Long Yuan Construction vs. Shanghai Yanpu Metal
Performance |
| Timeline |
| Long Yuan Construction |
| Shanghai Yanpu Metal |
Long Yuan and Shanghai Yanpu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Long Yuan and Shanghai Yanpu
The main advantage of trading using opposite Long Yuan and Shanghai Yanpu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Long Yuan position performs unexpectedly, Shanghai Yanpu 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 Yanpu will offset losses from the drop in Shanghai Yanpu's long position.| Long Yuan vs. Iat Automobile Technology | Long Yuan vs. Masterwork Machinery | Long Yuan vs. Tjk Machinery Tianjin | Long Yuan vs. Hongrun Construction Group |
| Shanghai Yanpu vs. Kweichow Moutai Co | Shanghai Yanpu vs. Contemporary Amperex Technology | Shanghai Yanpu vs. G bits Network Technology | Shanghai Yanpu vs. Beijing Roborock 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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