Correlation Between Shanghai Ziyan and Guangzhou Tinci
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By analyzing existing cross correlation between Shanghai Ziyan Foods and Guangzhou Tinci Materials, you can compare the effects of market volatilities on Shanghai Ziyan and Guangzhou Tinci 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 Ziyan with a short position of Guangzhou Tinci. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Ziyan and Guangzhou Tinci.
Diversification Opportunities for Shanghai Ziyan and Guangzhou Tinci
0.32 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Shanghai and Guangzhou is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Ziyan Foods and Guangzhou Tinci Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Tinci Materials and Shanghai Ziyan 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 Ziyan Foods are associated (or correlated) with Guangzhou Tinci. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Tinci Materials has no effect on the direction of Shanghai Ziyan i.e., Shanghai Ziyan and Guangzhou Tinci go up and down completely randomly.
Pair Corralation between Shanghai Ziyan and Guangzhou Tinci
Assuming the 90 days trading horizon Shanghai Ziyan Foods is expected to generate 0.84 times more return on investment than Guangzhou Tinci. However, Shanghai Ziyan Foods is 1.2 times less risky than Guangzhou Tinci. It trades about 0.08 of its potential returns per unit of risk. Guangzhou Tinci Materials is currently generating about 0.05 per unit of risk. If you would invest 1,384 in Shanghai Ziyan Foods on October 18, 2024 and sell it today you would earn a total of 365.00 from holding Shanghai Ziyan Foods or generate 26.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Ziyan Foods vs. Guangzhou Tinci Materials
Performance |
| Timeline |
| Shanghai Ziyan Foods |
| Guangzhou Tinci Materials |
Shanghai Ziyan and Guangzhou Tinci Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Ziyan and Guangzhou Tinci
The main advantage of trading using opposite Shanghai Ziyan and Guangzhou Tinci positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Ziyan position performs unexpectedly, Guangzhou Tinci 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 Guangzhou Tinci will offset losses from the drop in Guangzhou Tinci's long position.| Shanghai Ziyan vs. Beijing Watertek Information | Shanghai Ziyan vs. StarPower Semiconductor | Shanghai Ziyan vs. Zhongfu Information | Shanghai Ziyan vs. Qiming Information Technology |
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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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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