Correlation Between Shanghai Broadband and Qinghaihuading Industrial
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By analyzing existing cross correlation between Shanghai Broadband Technology and Qinghaihuading Industrial Co, you can compare the effects of market volatilities on Shanghai Broadband and Qinghaihuading Industrial 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 Qinghaihuading Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Broadband and Qinghaihuading Industrial.
Diversification Opportunities for Shanghai Broadband and Qinghaihuading Industrial
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Shanghai and Qinghaihuading is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Broadband Technology and Qinghaihuading Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qinghaihuading Industrial 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 Qinghaihuading Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qinghaihuading Industrial has no effect on the direction of Shanghai Broadband i.e., Shanghai Broadband and Qinghaihuading Industrial go up and down completely randomly.
Pair Corralation between Shanghai Broadband and Qinghaihuading Industrial
Assuming the 90 days trading horizon Shanghai Broadband Technology is expected to under-perform the Qinghaihuading Industrial. But the stock apears to be less risky and, when comparing its historical volatility, Shanghai Broadband Technology is 1.34 times less risky than Qinghaihuading Industrial. The stock trades about -0.02 of its potential returns per unit of risk. The Qinghaihuading Industrial Co is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 412.00 in Qinghaihuading Industrial Co on October 7, 2024 and sell it today you would lose (67.00) from holding Qinghaihuading Industrial Co or give up 16.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Broadband Technology vs. Qinghaihuading Industrial Co
Performance |
| Timeline |
| Shanghai Broadband |
| Qinghaihuading Industrial |
Shanghai Broadband and Qinghaihuading Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Broadband and Qinghaihuading Industrial
The main advantage of trading using opposite Shanghai Broadband and Qinghaihuading Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Broadband position performs unexpectedly, Qinghaihuading Industrial 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 Qinghaihuading Industrial will offset losses from the drop in Qinghaihuading Industrial's long position.| Shanghai Broadband vs. Zijin Mining Group | Shanghai Broadband vs. Wanhua Chemical Group | Shanghai Broadband vs. Baoshan Iron Steel | Shanghai Broadband vs. Rongsheng Petrochemical 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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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