Correlation Between Shanghai Ziyan and Gan Yuan
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By analyzing existing cross correlation between Shanghai Ziyan Foods and Gan Yuan Foods, you can compare the effects of market volatilities on Shanghai Ziyan and Gan Yuan 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 Gan Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Ziyan and Gan Yuan.
Diversification Opportunities for Shanghai Ziyan and Gan Yuan
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shanghai and Gan is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Ziyan Foods and Gan Yuan Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gan Yuan Foods 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 Gan Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gan Yuan Foods has no effect on the direction of Shanghai Ziyan i.e., Shanghai Ziyan and Gan Yuan go up and down completely randomly.
Pair Corralation between Shanghai Ziyan and Gan Yuan
Assuming the 90 days trading horizon Shanghai Ziyan Foods is expected to under-perform the Gan Yuan. But the stock apears to be less risky and, when comparing its historical volatility, Shanghai Ziyan Foods is 1.13 times less risky than Gan Yuan. The stock trades about -0.03 of its potential returns per unit of risk. The Gan Yuan Foods is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 7,327 in Gan Yuan Foods on August 28, 2024 and sell it today you would lose (17.00) from holding Gan Yuan Foods or give up 0.23% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Ziyan Foods vs. Gan Yuan Foods
Performance |
| Timeline |
| Shanghai Ziyan Foods |
| Gan Yuan Foods |
Shanghai Ziyan and Gan Yuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Ziyan and Gan Yuan
The main advantage of trading using opposite Shanghai Ziyan and Gan Yuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Ziyan position performs unexpectedly, Gan Yuan 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 Gan Yuan will offset losses from the drop in Gan Yuan's long position.| Shanghai Ziyan vs. Industrial and Commercial | Shanghai Ziyan vs. Agricultural Bank of | Shanghai Ziyan vs. China Construction Bank | Shanghai Ziyan vs. Bank of China |
| Gan Yuan vs. Marssenger Kitchenware Co | Gan Yuan vs. XinJiang GuoTong Pipeline | Gan Yuan vs. Yindu Kitchen Equipment | Gan Yuan vs. Zhejiang Kingland Pipeline |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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