Correlation Between Keda Clean and Shanghai Yanpu
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By analyzing existing cross correlation between Keda Clean Energy and Shanghai Yanpu Metal, you can compare the effects of market volatilities on Keda Clean 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 Keda Clean with a short position of Shanghai Yanpu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Keda Clean and Shanghai Yanpu.
Diversification Opportunities for Keda Clean and Shanghai Yanpu
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Keda and Shanghai is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Keda Clean Energy 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 Keda Clean 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 Keda Clean Energy 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 Keda Clean i.e., Keda Clean and Shanghai Yanpu go up and down completely randomly.
Pair Corralation between Keda Clean and Shanghai Yanpu
Assuming the 90 days trading horizon Keda Clean Energy is expected to under-perform the Shanghai Yanpu. But the stock apears to be less risky and, when comparing its historical volatility, Keda Clean Energy is 1.62 times less risky than Shanghai Yanpu. The stock trades about -0.02 of its potential returns per unit of risk. The Shanghai Yanpu Metal is currently generating about 0.04 of returns per unit of risk over similar time horizon. If you would invest 3,815 in Shanghai Yanpu Metal on September 12, 2024 and sell it today you would earn a total of 72.00 from holding Shanghai Yanpu Metal or generate 1.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Keda Clean Energy vs. Shanghai Yanpu Metal
Performance |
| Timeline |
| Keda Clean Energy |
| Shanghai Yanpu Metal |
Keda Clean and Shanghai Yanpu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Keda Clean and Shanghai Yanpu
The main advantage of trading using opposite Keda Clean and Shanghai Yanpu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Keda Clean 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.| Keda Clean vs. Eastern Communications Co | Keda Clean vs. Zhongtong Guomai Communication | Keda Clean vs. China Railway Construction | Keda Clean vs. Sinomach Automobile Co |
| Shanghai Yanpu vs. Lutian Machinery Co | Shanghai Yanpu vs. PetroChina Co Ltd | Shanghai Yanpu vs. Bank of China | Shanghai Yanpu vs. Gansu Jiu Steel |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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