Correlation Between Beijing Shanghai and Suzhou SLAC
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By analyzing existing cross correlation between Beijing Shanghai High Speed and Suzhou SLAC Precision, you can compare the effects of market volatilities on Beijing Shanghai and Suzhou SLAC 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 Beijing Shanghai with a short position of Suzhou SLAC. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Shanghai and Suzhou SLAC.
Diversification Opportunities for Beijing Shanghai and Suzhou SLAC
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Beijing and Suzhou is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Shanghai High Speed and Suzhou SLAC Precision in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Suzhou SLAC Precision and Beijing Shanghai 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 Beijing Shanghai High Speed are associated (or correlated) with Suzhou SLAC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Suzhou SLAC Precision has no effect on the direction of Beijing Shanghai i.e., Beijing Shanghai and Suzhou SLAC go up and down completely randomly.
Pair Corralation between Beijing Shanghai and Suzhou SLAC
Assuming the 90 days trading horizon Beijing Shanghai High Speed is expected to generate 0.29 times more return on investment than Suzhou SLAC. However, Beijing Shanghai High Speed is 3.47 times less risky than Suzhou SLAC. It trades about 0.3 of its potential returns per unit of risk. Suzhou SLAC Precision is currently generating about 0.05 per unit of risk. If you would invest 559.00 in Beijing Shanghai High Speed on September 12, 2024 and sell it today you would earn a total of 63.00 from holding Beijing Shanghai High Speed or generate 11.27% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Shanghai High Speed vs. Suzhou SLAC Precision
Performance |
| Timeline |
| Beijing Shanghai High |
| Suzhou SLAC Precision |
Beijing Shanghai and Suzhou SLAC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Shanghai and Suzhou SLAC
The main advantage of trading using opposite Beijing Shanghai and Suzhou SLAC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Shanghai position performs unexpectedly, Suzhou SLAC 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 Suzhou SLAC will offset losses from the drop in Suzhou SLAC's long position.| Beijing Shanghai vs. China Railway Construction | Beijing Shanghai vs. Qijing Machinery | Beijing Shanghai vs. Sichuan Yahua Industrial | Beijing Shanghai vs. Huitong Construction Group |
| Suzhou SLAC vs. Kuangda Technology Group | Suzhou SLAC vs. Citic Guoan Wine | Suzhou SLAC vs. Jiujiang Shanshui Technology | Suzhou SLAC vs. Guangzhou KingTeller 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 Global Correlations module to find global opportunities by holding instruments from different markets.
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