Correlation Between Shanghai Jinfeng and Sinosteel Luonai
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By analyzing existing cross correlation between Shanghai Jinfeng Wine and Sinosteel Luonai Materials, you can compare the effects of market volatilities on Shanghai Jinfeng and Sinosteel Luonai 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 Jinfeng with a short position of Sinosteel Luonai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Jinfeng and Sinosteel Luonai.
Diversification Opportunities for Shanghai Jinfeng and Sinosteel Luonai
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shanghai and Sinosteel is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Jinfeng Wine and Sinosteel Luonai Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinosteel Luonai Mat and Shanghai Jinfeng 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 Jinfeng Wine are associated (or correlated) with Sinosteel Luonai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinosteel Luonai Mat has no effect on the direction of Shanghai Jinfeng i.e., Shanghai Jinfeng and Sinosteel Luonai go up and down completely randomly.
Pair Corralation between Shanghai Jinfeng and Sinosteel Luonai
Assuming the 90 days trading horizon Shanghai Jinfeng Wine is expected to generate 1.17 times more return on investment than Sinosteel Luonai. However, Shanghai Jinfeng is 1.17 times more volatile than Sinosteel Luonai Materials. It trades about 0.15 of its potential returns per unit of risk. Sinosteel Luonai Materials is currently generating about 0.02 per unit of risk. If you would invest 547.00 in Shanghai Jinfeng Wine on September 1, 2024 and sell it today you would earn a total of 47.00 from holding Shanghai Jinfeng Wine or generate 8.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Jinfeng Wine vs. Sinosteel Luonai Materials
Performance |
| Timeline |
| Shanghai Jinfeng Wine |
| Sinosteel Luonai Mat |
Shanghai Jinfeng and Sinosteel Luonai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Jinfeng and Sinosteel Luonai
The main advantage of trading using opposite Shanghai Jinfeng and Sinosteel Luonai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Jinfeng position performs unexpectedly, Sinosteel Luonai 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 Sinosteel Luonai will offset losses from the drop in Sinosteel Luonai's long position.| Shanghai Jinfeng vs. Dongfeng Automobile Co | Shanghai Jinfeng vs. Tongling Nonferrous Metals | Shanghai Jinfeng vs. Ye Chiu Metal | Shanghai Jinfeng vs. Allwin Telecommunication Co |
| Sinosteel Luonai vs. Hangzhou Minsheng Healthcare | Sinosteel Luonai vs. Yunnan Jianzhijia Health Chain | Sinosteel Luonai vs. Everjoy Health Group | Sinosteel Luonai vs. By health |
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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