Correlation Between Shanghai Broadband and Xinhu Zhongbao
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By analyzing existing cross correlation between Shanghai Broadband Technology and Xinhu Zhongbao Co, you can compare the effects of market volatilities on Shanghai Broadband and Xinhu Zhongbao 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 Xinhu Zhongbao. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Broadband and Xinhu Zhongbao.
Diversification Opportunities for Shanghai Broadband and Xinhu Zhongbao
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shanghai and Xinhu is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Broadband Technology and Xinhu Zhongbao Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinhu Zhongbao 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 Xinhu Zhongbao. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinhu Zhongbao has no effect on the direction of Shanghai Broadband i.e., Shanghai Broadband and Xinhu Zhongbao go up and down completely randomly.
Pair Corralation between Shanghai Broadband and Xinhu Zhongbao
Assuming the 90 days trading horizon Shanghai Broadband Technology is expected to under-perform the Xinhu Zhongbao. In addition to that, Shanghai Broadband is 1.11 times more volatile than Xinhu Zhongbao Co. It trades about -0.03 of its total potential returns per unit of risk. Xinhu Zhongbao Co is currently generating about 0.02 per unit of volatility. If you would invest 268.00 in Xinhu Zhongbao Co on November 2, 2024 and sell it today you would earn a total of 20.00 from holding Xinhu Zhongbao Co or generate 7.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Broadband Technology vs. Xinhu Zhongbao Co
Performance |
| Timeline |
| Shanghai Broadband |
| Xinhu Zhongbao |
Shanghai Broadband and Xinhu Zhongbao Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Broadband and Xinhu Zhongbao
The main advantage of trading using opposite Shanghai Broadband and Xinhu Zhongbao positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Broadband position performs unexpectedly, Xinhu Zhongbao 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 Xinhu Zhongbao will offset losses from the drop in Xinhu Zhongbao's long position.| Shanghai Broadband vs. Guangzhou KingTeller Technology | Shanghai Broadband vs. Dr Peng Telecom | Shanghai Broadband vs. Linewell Software Co | Shanghai Broadband vs. Beijing Seeyon Internet |
| Xinhu Zhongbao vs. Wuhan Yangtze Communication | Xinhu Zhongbao vs. Beijing Yanjing Brewery | Xinhu Zhongbao vs. Shanghai Ziyan Foods | Xinhu Zhongbao vs. Guangxi Wuzhou Communications |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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