Correlation Between Shanghai Electric and Beijing Kaiwen
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By analyzing existing cross correlation between Shanghai Electric Group and Beijing Kaiwen Education, you can compare the effects of market volatilities on Shanghai Electric and Beijing Kaiwen 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 Electric with a short position of Beijing Kaiwen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Electric and Beijing Kaiwen.
Diversification Opportunities for Shanghai Electric and Beijing Kaiwen
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shanghai and Beijing is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Electric Group and Beijing Kaiwen Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Kaiwen Education and Shanghai Electric 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 Electric Group are associated (or correlated) with Beijing Kaiwen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Kaiwen Education has no effect on the direction of Shanghai Electric i.e., Shanghai Electric and Beijing Kaiwen go up and down completely randomly.
Pair Corralation between Shanghai Electric and Beijing Kaiwen
Assuming the 90 days trading horizon Shanghai Electric is expected to generate 1.19 times less return on investment than Beijing Kaiwen. In addition to that, Shanghai Electric is 1.54 times more volatile than Beijing Kaiwen Education. It trades about 0.03 of its total potential returns per unit of risk. Beijing Kaiwen Education is currently generating about 0.06 per unit of volatility. If you would invest 506.00 in Beijing Kaiwen Education on August 31, 2024 and sell it today you would earn a total of 19.00 from holding Beijing Kaiwen Education or generate 3.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Shanghai Electric Group vs. Beijing Kaiwen Education
Performance |
| Timeline |
| Shanghai Electric |
| Beijing Kaiwen Education |
Shanghai Electric and Beijing Kaiwen Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Electric and Beijing Kaiwen
The main advantage of trading using opposite Shanghai Electric and Beijing Kaiwen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Electric position performs unexpectedly, Beijing Kaiwen 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 Kaiwen will offset losses from the drop in Beijing Kaiwen's long position.| Shanghai Electric vs. Uroica Mining Safety | Shanghai Electric vs. Guangdong Advertising Co | Shanghai Electric vs. Shengda Mining Co | Shanghai Electric vs. Zhongshan Broad Ocean Motor |
| Beijing Kaiwen vs. Cultural Investment Holdings | Beijing Kaiwen vs. Gome Telecom Equipment | Beijing Kaiwen vs. Bus Online Co | Beijing Kaiwen vs. Holitech Technology Co |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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