Correlation Between HeBei Jinniu and Shanghai Shibei
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By analyzing existing cross correlation between HeBei Jinniu Chemical and Shanghai Shibei Hi Tech, you can compare the effects of market volatilities on HeBei Jinniu and Shanghai Shibei 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 HeBei Jinniu with a short position of Shanghai Shibei. Check out your portfolio center. Please also check ongoing floating volatility patterns of HeBei Jinniu and Shanghai Shibei.
Diversification Opportunities for HeBei Jinniu and Shanghai Shibei
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between HeBei and Shanghai is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding HeBei Jinniu Chemical and Shanghai Shibei Hi Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Shibei Hi and HeBei Jinniu 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 HeBei Jinniu Chemical are associated (or correlated) with Shanghai Shibei. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Shibei Hi has no effect on the direction of HeBei Jinniu i.e., HeBei Jinniu and Shanghai Shibei go up and down completely randomly.
Pair Corralation between HeBei Jinniu and Shanghai Shibei
Assuming the 90 days trading horizon HeBei Jinniu Chemical is expected to generate 0.97 times more return on investment than Shanghai Shibei. However, HeBei Jinniu Chemical is 1.03 times less risky than Shanghai Shibei. It trades about 0.02 of its potential returns per unit of risk. Shanghai Shibei Hi Tech is currently generating about 0.0 per unit of risk. If you would invest 508.00 in HeBei Jinniu Chemical on October 14, 2024 and sell it today you would earn a total of 29.00 from holding HeBei Jinniu Chemical or generate 5.71% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
HeBei Jinniu Chemical vs. Shanghai Shibei Hi Tech
Performance |
| Timeline |
| HeBei Jinniu Chemical |
| Shanghai Shibei Hi |
HeBei Jinniu and Shanghai Shibei Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with HeBei Jinniu and Shanghai Shibei
The main advantage of trading using opposite HeBei Jinniu and Shanghai Shibei positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HeBei Jinniu position performs unexpectedly, Shanghai Shibei 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 Shibei will offset losses from the drop in Shanghai Shibei's long position.| HeBei Jinniu vs. Jinhui Liquor Co | HeBei Jinniu vs. Bomesc Offshore Engineering | HeBei Jinniu vs. Anhui Jianghuai Automobile | HeBei Jinniu vs. Guangxi Wuzhou Communications |
| Shanghai Shibei vs. HeBei Jinniu Chemical | Shanghai Shibei vs. Liuzhou Chemical Industry | Shanghai Shibei vs. Sportsoul Co Ltd | Shanghai Shibei vs. Ciwen Media 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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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