Correlation Between Industrial and Beijing Shanghai
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By analyzing existing cross correlation between Industrial and Commercial and Beijing Shanghai High Speed, you can compare the effects of market volatilities on Industrial and Beijing Shanghai 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 Industrial with a short position of Beijing Shanghai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial and Beijing Shanghai.
Diversification Opportunities for Industrial and Beijing Shanghai
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Industrial and Beijing is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Industrial and Commercial and Beijing Shanghai High Speed in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Shanghai High and Industrial 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 Industrial and Commercial are associated (or correlated) with Beijing Shanghai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Shanghai High has no effect on the direction of Industrial i.e., Industrial and Beijing Shanghai go up and down completely randomly.
Pair Corralation between Industrial and Beijing Shanghai
Assuming the 90 days trading horizon Industrial and Commercial is expected to generate 0.64 times more return on investment than Beijing Shanghai. However, Industrial and Commercial is 1.56 times less risky than Beijing Shanghai. It trades about 0.07 of its potential returns per unit of risk. Beijing Shanghai High Speed is currently generating about -0.05 per unit of risk. If you would invest 607.00 in Industrial and Commercial on August 29, 2024 and sell it today you would earn a total of 9.00 from holding Industrial and Commercial or generate 1.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial and Commercial vs. Beijing Shanghai High Speed
Performance |
| Timeline |
| Industrial and Commercial |
| Beijing Shanghai High |
Industrial and Beijing Shanghai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial and Beijing Shanghai
The main advantage of trading using opposite Industrial and Beijing Shanghai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial position performs unexpectedly, Beijing Shanghai 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 Beijing Shanghai will offset losses from the drop in Beijing Shanghai's long position.| Industrial vs. Sinofibers Technology Co | Industrial vs. Saurer Intelligent Technology | Industrial vs. Sinocelltech Group | Industrial vs. Dhc Software Co |
| Beijing Shanghai vs. Yonyou Auto Information | Beijing Shanghai vs. Digital China Information | Beijing Shanghai vs. Jiaozuo Wanfang Aluminum | Beijing Shanghai vs. Anhui Transport Consulting |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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