Correlation Between China State and Shanghai Action
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By analyzing existing cross correlation between China State Construction and Shanghai Action Education, you can compare the effects of market volatilities on China State and Shanghai Action 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 State with a short position of Shanghai Action. Check out your portfolio center. Please also check ongoing floating volatility patterns of China State and Shanghai Action.
Diversification Opportunities for China State and Shanghai Action
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Shanghai is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding China State Construction and Shanghai Action Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Action Education and China State 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 State Construction are associated (or correlated) with Shanghai Action. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Action Education has no effect on the direction of China State i.e., China State and Shanghai Action go up and down completely randomly.
Pair Corralation between China State and Shanghai Action
Assuming the 90 days trading horizon China State Construction is expected to generate 1.02 times more return on investment than Shanghai Action. However, China State is 1.02 times more volatile than Shanghai Action Education. It trades about 0.06 of its potential returns per unit of risk. Shanghai Action Education is currently generating about 0.04 per unit of risk. If you would invest 547.00 in China State Construction on August 28, 2024 and sell it today you would earn a total of 42.00 from holding China State Construction or generate 7.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China State Construction vs. Shanghai Action Education
Performance |
| Timeline |
| China State Construction |
| Shanghai Action Education |
China State and Shanghai Action Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China State and Shanghai Action
The main advantage of trading using opposite China State and Shanghai Action positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China State position performs unexpectedly, Shanghai Action 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 Action will offset losses from the drop in Shanghai Action's long position.| China State vs. Ming Yang Smart | China State vs. 159681 | China State vs. 159005 | China State vs. Loctek Ergonomic Technology |
| Shanghai Action vs. Jiangsu Broadcasting Cable | Shanghai Action vs. Shaanxi Broadcast TV | Shanghai Action vs. Hubeiyichang Transportation Group | Shanghai Action vs. Shanghai Broadband Technology |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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