Correlation Between Ping An and Shanghai Pudong
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By analyzing existing cross correlation between Ping An Insurance and Shanghai Pudong Development, you can compare the effects of market volatilities on Ping An and Shanghai Pudong 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 Ping An with a short position of Shanghai Pudong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ping An and Shanghai Pudong.
Diversification Opportunities for Ping An and Shanghai Pudong
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Ping and Shanghai is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Ping An Insurance and Shanghai Pudong Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Pudong Deve and Ping An 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 Ping An Insurance are associated (or correlated) with Shanghai Pudong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Pudong Deve has no effect on the direction of Ping An i.e., Ping An and Shanghai Pudong go up and down completely randomly.
Pair Corralation between Ping An and Shanghai Pudong
Assuming the 90 days trading horizon Ping An is expected to generate 1.36 times less return on investment than Shanghai Pudong. In addition to that, Ping An is 1.57 times more volatile than Shanghai Pudong Development. It trades about 0.03 of its total potential returns per unit of risk. Shanghai Pudong Development is currently generating about 0.06 per unit of volatility. If you would invest 706.00 in Shanghai Pudong Development on August 29, 2024 and sell it today you would earn a total of 237.00 from holding Shanghai Pudong Development or generate 33.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ping An Insurance vs. Shanghai Pudong Development
Performance |
| Timeline |
| Ping An Insurance |
| Shanghai Pudong Deve |
Ping An and Shanghai Pudong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ping An and Shanghai Pudong
The main advantage of trading using opposite Ping An and Shanghai Pudong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ping An position performs unexpectedly, Shanghai Pudong 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 Pudong will offset losses from the drop in Shanghai Pudong's long position.| Ping An vs. Kweichow Moutai Co | Ping An vs. Contemporary Amperex Technology | Ping An vs. G bits Network Technology | Ping An vs. BYD Co Ltd |
| Shanghai Pudong vs. Hang Xiao Steel | Shanghai Pudong vs. Gansu Jiu Steel | Shanghai Pudong vs. Tianjin Capital Environmental | Shanghai Pudong vs. Eit Environmental Development |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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