Correlation Between Hengdian Entertainment and Shanghai
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By analyzing existing cross correlation between Hengdian Entertainment Co and Shanghai MG Stationery, you can compare the effects of market volatilities on Hengdian Entertainment and Shanghai 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 Hengdian Entertainment with a short position of Shanghai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hengdian Entertainment and Shanghai.
Diversification Opportunities for Hengdian Entertainment and Shanghai
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Hengdian and Shanghai is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Hengdian Entertainment Co and Shanghai MG Stationery in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai MG Stationery and Hengdian Entertainment 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 Hengdian Entertainment Co are associated (or correlated) with Shanghai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai MG Stationery has no effect on the direction of Hengdian Entertainment i.e., Hengdian Entertainment and Shanghai go up and down completely randomly.
Pair Corralation between Hengdian Entertainment and Shanghai
Assuming the 90 days trading horizon Hengdian Entertainment Co is expected to generate 1.61 times more return on investment than Shanghai. However, Hengdian Entertainment is 1.61 times more volatile than Shanghai MG Stationery. It trades about 0.02 of its potential returns per unit of risk. Shanghai MG Stationery is currently generating about -0.05 per unit of risk. If you would invest 1,433 in Hengdian Entertainment Co on November 28, 2024 and sell it today you would lose (11.00) from holding Hengdian Entertainment Co or give up 0.77% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Hengdian Entertainment Co vs. Shanghai MG Stationery
Performance |
| Timeline |
| Hengdian Entertainment |
| Shanghai MG Stationery |
Hengdian Entertainment and Shanghai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hengdian Entertainment and Shanghai
The main advantage of trading using opposite Hengdian Entertainment and Shanghai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hengdian Entertainment position performs unexpectedly, Shanghai 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 Shanghai will offset losses from the drop in Shanghai's long position.| Hengdian Entertainment vs. Industrial and Commercial | Hengdian Entertainment vs. Agricultural Bank of | Hengdian Entertainment vs. China Construction Bank | Hengdian Entertainment vs. Bank of China |
| Shanghai vs. Bosera CMSK Industrial | Shanghai vs. Hengerda New Materials | Shanghai vs. JCHX Mining Management | Shanghai vs. Super Dragon Engineering Plastics |
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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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