Correlation Between Shanghai Xinhua and Smartgiant Technology
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By analyzing existing cross correlation between Shanghai Xinhua Media and Smartgiant Technology Co, you can compare the effects of market volatilities on Shanghai Xinhua and Smartgiant Technology 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 Xinhua with a short position of Smartgiant Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Xinhua and Smartgiant Technology.
Diversification Opportunities for Shanghai Xinhua and Smartgiant Technology
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Shanghai and Smartgiant is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Xinhua Media and Smartgiant Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Smartgiant Technology and Shanghai Xinhua 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 Xinhua Media are associated (or correlated) with Smartgiant Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Smartgiant Technology has no effect on the direction of Shanghai Xinhua i.e., Shanghai Xinhua and Smartgiant Technology go up and down completely randomly.
Pair Corralation between Shanghai Xinhua and Smartgiant Technology
Assuming the 90 days trading horizon Shanghai Xinhua Media is expected to under-perform the Smartgiant Technology. But the stock apears to be less risky and, when comparing its historical volatility, Shanghai Xinhua Media is 1.03 times less risky than Smartgiant Technology. The stock trades about -0.16 of its potential returns per unit of risk. The Smartgiant Technology Co is currently generating about -0.16 of returns per unit of risk over similar time horizon. If you would invest 4,406 in Smartgiant Technology Co on October 29, 2024 and sell it today you would lose (446.00) from holding Smartgiant Technology Co or give up 10.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Xinhua Media vs. Smartgiant Technology Co
Performance |
| Timeline |
| Shanghai Xinhua Media |
| Smartgiant Technology |
Shanghai Xinhua and Smartgiant Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Xinhua and Smartgiant Technology
The main advantage of trading using opposite Shanghai Xinhua and Smartgiant Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Xinhua position performs unexpectedly, Smartgiant Technology 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 Smartgiant Technology will offset losses from the drop in Smartgiant Technology's long position.| Shanghai Xinhua vs. Tieling Newcity Investment | Shanghai Xinhua vs. Beijing Mainstreets Investment | Shanghai Xinhua vs. Luyin Investment Group | Shanghai Xinhua vs. Shaanxi Construction Machinery |
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 Alpha Finder module to use alpha and beta coefficients to find investment opportunities after accounting for the risk.
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