Correlation Between China Railway and Shandong Publishing
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By analyzing existing cross correlation between China Railway Group and Shandong Publishing Media, you can compare the effects of market volatilities on China Railway and Shandong Publishing 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 China Railway with a short position of Shandong Publishing. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Railway and Shandong Publishing.
Diversification Opportunities for China Railway and Shandong Publishing
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Shandong is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding China Railway Group and Shandong Publishing Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Publishing Media and China Railway 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 China Railway Group are associated (or correlated) with Shandong Publishing. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Publishing Media has no effect on the direction of China Railway i.e., China Railway and Shandong Publishing go up and down completely randomly.
Pair Corralation between China Railway and Shandong Publishing
Assuming the 90 days trading horizon China Railway Group is expected to generate 0.71 times more return on investment than Shandong Publishing. However, China Railway Group is 1.42 times less risky than Shandong Publishing. It trades about -0.07 of its potential returns per unit of risk. Shandong Publishing Media is currently generating about -0.19 per unit of risk. If you would invest 592.00 in China Railway Group on January 27, 2025 and sell it today you would lose (27.00) from holding China Railway Group or give up 4.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Railway Group vs. Shandong Publishing Media
Performance |
| Timeline |
| China Railway Group |
| Shandong Publishing Media |
China Railway and Shandong Publishing Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Railway and Shandong Publishing
The main advantage of trading using opposite China Railway and Shandong Publishing positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Railway position performs unexpectedly, Shandong Publishing 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 Publishing will offset losses from the drop in Shandong Publishing's long position.| China Railway vs. Shanghai Metersbonwe FashionAccessories | China Railway vs. Queclink Wireless Solutions | China Railway vs. Zhejiang Yinlun Machinery | China Railway vs. Gemac Engineering Machinery |
| Shandong Publishing vs. Yoantion Industrial IncLtd | Shandong Publishing vs. Offcn Education Technology | Shandong Publishing vs. Shanghai Action Education | Shandong Publishing vs. Zijin Mining Group |
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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