Correlation Between Shanghai Zhangjiang and Hunan Nanling
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By analyzing existing cross correlation between Shanghai Zhangjiang Hi Tech and Hunan Nanling Industrial, you can compare the effects of market volatilities on Shanghai Zhangjiang and Hunan Nanling 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 Zhangjiang with a short position of Hunan Nanling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Zhangjiang and Hunan Nanling.
Diversification Opportunities for Shanghai Zhangjiang and Hunan Nanling
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shanghai and Hunan is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Zhangjiang Hi Tech and Hunan Nanling Industrial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hunan Nanling Industrial and Shanghai Zhangjiang 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 Zhangjiang Hi Tech are associated (or correlated) with Hunan Nanling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hunan Nanling Industrial has no effect on the direction of Shanghai Zhangjiang i.e., Shanghai Zhangjiang and Hunan Nanling go up and down completely randomly.
Pair Corralation between Shanghai Zhangjiang and Hunan Nanling
Assuming the 90 days trading horizon Shanghai Zhangjiang Hi Tech is expected to generate 2.13 times more return on investment than Hunan Nanling. However, Shanghai Zhangjiang is 2.13 times more volatile than Hunan Nanling Industrial. It trades about 0.07 of its potential returns per unit of risk. Hunan Nanling Industrial is currently generating about -0.2 per unit of risk. If you would invest 2,657 in Shanghai Zhangjiang Hi Tech on August 29, 2024 and sell it today you would earn a total of 145.00 from holding Shanghai Zhangjiang Hi Tech or generate 5.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Zhangjiang Hi Tech vs. Hunan Nanling Industrial
Performance |
| Timeline |
| Shanghai Zhangjiang |
| Hunan Nanling Industrial |
Shanghai Zhangjiang and Hunan Nanling Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Zhangjiang and Hunan Nanling
The main advantage of trading using opposite Shanghai Zhangjiang and Hunan Nanling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Zhangjiang position performs unexpectedly, Hunan Nanling 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 Hunan Nanling will offset losses from the drop in Hunan Nanling's long position.| Shanghai Zhangjiang vs. Industrial and Commercial | Shanghai Zhangjiang vs. China Construction Bank | Shanghai Zhangjiang vs. Bank of China | Shanghai Zhangjiang vs. Agricultural Bank of |
| Hunan Nanling vs. CGN Nuclear Technology | Hunan Nanling vs. Jiangsu Phoenix Publishing | Hunan Nanling vs. Keli Sensing Technology | Hunan Nanling vs. Guangzhou KingTeller Technology |
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 Portfolio Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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