Correlation Between Peoples Insurance and Shandong Longda
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By analyzing existing cross correlation between Peoples Insurance of and Shandong Longda Meat, you can compare the effects of market volatilities on Peoples Insurance and Shandong Longda 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 Peoples Insurance with a short position of Shandong Longda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Peoples Insurance and Shandong Longda.
Diversification Opportunities for Peoples Insurance and Shandong Longda
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Peoples and Shandong is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Peoples Insurance of and Shandong Longda Meat in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Longda Meat and Peoples Insurance 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 Peoples Insurance of are associated (or correlated) with Shandong Longda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Longda Meat has no effect on the direction of Peoples Insurance i.e., Peoples Insurance and Shandong Longda go up and down completely randomly.
Pair Corralation between Peoples Insurance and Shandong Longda
Assuming the 90 days trading horizon Peoples Insurance of is expected to generate 0.82 times more return on investment than Shandong Longda. However, Peoples Insurance of is 1.22 times less risky than Shandong Longda. It trades about -0.21 of its potential returns per unit of risk. Shandong Longda Meat is currently generating about -0.19 per unit of risk. If you would invest 754.00 in Peoples Insurance of on October 11, 2024 and sell it today you would lose (67.00) from holding Peoples Insurance of or give up 8.89% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Peoples Insurance of vs. Shandong Longda Meat
Performance |
| Timeline |
| Peoples Insurance |
| Shandong Longda Meat |
Peoples Insurance and Shandong Longda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Peoples Insurance and Shandong Longda
The main advantage of trading using opposite Peoples Insurance and Shandong Longda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Peoples Insurance position performs unexpectedly, Shandong Longda 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 Shandong Longda will offset losses from the drop in Shandong Longda's long position.| Peoples Insurance vs. Jiangsu Jinling Sports | Peoples Insurance vs. Zhejiang JIULI Hi tech | Peoples Insurance vs. Jiangxi Hengda Hi Tech | Peoples Insurance vs. Fujian Newland Computer |
| Shandong Longda vs. Tongling Nonferrous Metals | Shandong Longda vs. Ping An Insurance | Shandong Longda vs. Postal Savings Bank | Shandong Longda vs. Peoples Insurance of |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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