Correlation Between Shanghai Ziyan and Guangdong Skychem
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By analyzing existing cross correlation between Shanghai Ziyan Foods and Guangdong Skychem Technology, you can compare the effects of market volatilities on Shanghai Ziyan and Guangdong Skychem 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 Guangdong Skychem. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Ziyan and Guangdong Skychem.
Diversification Opportunities for Shanghai Ziyan and Guangdong Skychem
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shanghai and Guangdong is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Ziyan Foods and Guangdong Skychem Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Skychem 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 Guangdong Skychem. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Skychem has no effect on the direction of Shanghai Ziyan i.e., Shanghai Ziyan and Guangdong Skychem go up and down completely randomly.
Pair Corralation between Shanghai Ziyan and Guangdong Skychem
Assuming the 90 days trading horizon Shanghai Ziyan Foods is expected to under-perform the Guangdong Skychem. But the stock apears to be less risky and, when comparing its historical volatility, Shanghai Ziyan Foods is 1.37 times less risky than Guangdong Skychem. The stock trades about -0.26 of its potential returns per unit of risk. The Guangdong Skychem Technology is currently generating about -0.1 of returns per unit of risk over similar time horizon. If you would invest 8,034 in Guangdong Skychem Technology on November 1, 2024 and sell it today you would lose (784.00) from holding Guangdong Skychem Technology or give up 9.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Ziyan Foods vs. Guangdong Skychem Technology
Performance |
| Timeline |
| Shanghai Ziyan Foods |
| Guangdong Skychem |
Shanghai Ziyan and Guangdong Skychem Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Ziyan and Guangdong Skychem
The main advantage of trading using opposite Shanghai Ziyan and Guangdong Skychem positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Ziyan position performs unexpectedly, Guangdong Skychem 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 Guangdong Skychem will offset losses from the drop in Guangdong Skychem's long position.| Shanghai Ziyan vs. Guangzhou Restaurants Group | Shanghai Ziyan vs. State Grid InformationCommunication | Shanghai Ziyan vs. Tongyu Communication | Shanghai Ziyan vs. Namchow Food Group |
| Guangdong Skychem vs. China World Trade | Guangdong Skychem vs. Fujian Anjoy Foods | Guangdong Skychem vs. Shanghai Ziyan Foods | Guangdong Skychem vs. Shenyang Chemical Industry |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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