Correlation Between Shanghai Broadband and Shanxi Tond
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By analyzing existing cross correlation between Shanghai Broadband Technology and Shanxi Tond Chemical, you can compare the effects of market volatilities on Shanghai Broadband and Shanxi Tond 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 Shanghai Broadband with a short position of Shanxi Tond. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Broadband and Shanxi Tond.
Diversification Opportunities for Shanghai Broadband and Shanxi Tond
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shanghai and Shanxi is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Broadband Technology and Shanxi Tond Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanxi Tond Chemical and Shanghai Broadband 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 Shanghai Broadband Technology are associated (or correlated) with Shanxi Tond. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanxi Tond Chemical has no effect on the direction of Shanghai Broadband i.e., Shanghai Broadband and Shanxi Tond go up and down completely randomly.
Pair Corralation between Shanghai Broadband and Shanxi Tond
Assuming the 90 days trading horizon Shanghai Broadband Technology is expected to generate 1.18 times more return on investment than Shanxi Tond. However, Shanghai Broadband is 1.18 times more volatile than Shanxi Tond Chemical. It trades about -0.02 of its potential returns per unit of risk. Shanxi Tond Chemical is currently generating about -0.03 per unit of risk. If you would invest 469.00 in Shanghai Broadband Technology on October 13, 2024 and sell it today you would lose (155.00) from holding Shanghai Broadband Technology or give up 33.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Broadband Technology vs. Shanxi Tond Chemical
Performance |
| Timeline |
| Shanghai Broadband |
| Shanxi Tond Chemical |
Shanghai Broadband and Shanxi Tond Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Broadband and Shanxi Tond
The main advantage of trading using opposite Shanghai Broadband and Shanxi Tond positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Broadband position performs unexpectedly, Shanxi Tond 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 Shanxi Tond will offset losses from the drop in Shanxi Tond's long position.| Shanghai Broadband vs. Duzhe Publishing Media | Shanghai Broadband vs. Beijing Enlight Media | Shanghai Broadband vs. Anhui Xinhua Media | Shanghai Broadband vs. Zhengzhou Coal Mining |
| Shanxi Tond vs. Nanjing Vishee Medical | Shanxi Tond vs. Shenzhen MYS Environmental | Shanxi Tond vs. Tinavi Medical Technologies | Shanxi Tond vs. GreenTech Environmental Co |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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