Correlation Between Shanghai Pharmaceuticals and Industrial
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By analyzing existing cross correlation between Shanghai Pharmaceuticals Holding and Industrial and Commercial, you can compare the effects of market volatilities on Shanghai Pharmaceuticals and Industrial 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 Shanghai Pharmaceuticals with a short position of Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Pharmaceuticals and Industrial.
Diversification Opportunities for Shanghai Pharmaceuticals and Industrial
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Shanghai and Industrial is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Pharmaceuticals Holdi and Industrial and Commercial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industrial and Commercial and Shanghai Pharmaceuticals 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 Shanghai Pharmaceuticals Holding are associated (or correlated) with Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industrial and Commercial has no effect on the direction of Shanghai Pharmaceuticals i.e., Shanghai Pharmaceuticals and Industrial go up and down completely randomly.
Pair Corralation between Shanghai Pharmaceuticals and Industrial
If you would invest 402.00 in Industrial and Commercial on November 2, 2024 and sell it today you would earn a total of 280.00 from holding Industrial and Commercial or generate 69.65% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.21% |
| Values | Daily Returns |
Shanghai Pharmaceuticals Holdi vs. Industrial and Commercial
Performance |
| Timeline |
| Shanghai Pharmaceuticals |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
| Industrial and Commercial |
Shanghai Pharmaceuticals and Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Pharmaceuticals and Industrial
The main advantage of trading using opposite Shanghai Pharmaceuticals and Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Pharmaceuticals position performs unexpectedly, Industrial 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 Industrial will offset losses from the drop in Industrial's long position.The idea behind Shanghai Pharmaceuticals Holding and Industrial and Commercial pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
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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 Global Correlations module to find global opportunities by holding instruments from different markets.
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