Correlation Between Dongxing Sec and Shanghai Yanpu
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By analyzing existing cross correlation between Dongxing Sec Co and Shanghai Yanpu Metal, you can compare the effects of market volatilities on Dongxing Sec and Shanghai Yanpu 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 Dongxing Sec with a short position of Shanghai Yanpu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongxing Sec and Shanghai Yanpu.
Diversification Opportunities for Dongxing Sec and Shanghai Yanpu
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dongxing and Shanghai is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Dongxing Sec Co and Shanghai Yanpu Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Yanpu Metal and Dongxing Sec 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 Dongxing Sec Co are associated (or correlated) with Shanghai Yanpu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Yanpu Metal has no effect on the direction of Dongxing Sec i.e., Dongxing Sec and Shanghai Yanpu go up and down completely randomly.
Pair Corralation between Dongxing Sec and Shanghai Yanpu
Assuming the 90 days trading horizon Dongxing Sec Co is expected to generate 0.79 times more return on investment than Shanghai Yanpu. However, Dongxing Sec Co is 1.27 times less risky than Shanghai Yanpu. It trades about 0.06 of its potential returns per unit of risk. Shanghai Yanpu Metal is currently generating about 0.02 per unit of risk. If you would invest 799.00 in Dongxing Sec Co on September 26, 2024 and sell it today you would earn a total of 345.00 from holding Dongxing Sec Co or generate 43.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongxing Sec Co vs. Shanghai Yanpu Metal
Performance |
| Timeline |
| Dongxing Sec |
| Shanghai Yanpu Metal |
Dongxing Sec and Shanghai Yanpu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongxing Sec and Shanghai Yanpu
The main advantage of trading using opposite Dongxing Sec and Shanghai Yanpu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongxing Sec position performs unexpectedly, Shanghai Yanpu 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 Yanpu will offset losses from the drop in Shanghai Yanpu's long position.| Dongxing Sec vs. Kweichow Moutai Co | Dongxing Sec vs. Contemporary Amperex Technology | Dongxing Sec vs. G bits Network Technology | Dongxing Sec vs. BYD Co Ltd |
| Shanghai Yanpu vs. China Life Insurance | Shanghai Yanpu vs. Cinda Securities Co | Shanghai Yanpu vs. Piotech Inc A | Shanghai Yanpu vs. Dongxing Sec 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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