Correlation Between Hengdian Entertainment and Shanghai Yaohua
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By analyzing existing cross correlation between Hengdian Entertainment Co and Shanghai Yaohua Pilkington, you can compare the effects of market volatilities on Hengdian Entertainment and Shanghai Yaohua 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 Yaohua. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hengdian Entertainment and Shanghai Yaohua.
Diversification Opportunities for Hengdian Entertainment and Shanghai Yaohua
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Hengdian and Shanghai is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Hengdian Entertainment Co and Shanghai Yaohua Pilkington in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Yaohua Pilk 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 Yaohua. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Yaohua Pilk has no effect on the direction of Hengdian Entertainment i.e., Hengdian Entertainment and Shanghai Yaohua go up and down completely randomly.
Pair Corralation between Hengdian Entertainment and Shanghai Yaohua
Assuming the 90 days trading horizon Hengdian Entertainment Co is expected to generate 1.35 times more return on investment than Shanghai Yaohua. However, Hengdian Entertainment is 1.35 times more volatile than Shanghai Yaohua Pilkington. It trades about 0.17 of its potential returns per unit of risk. Shanghai Yaohua Pilkington is currently generating about 0.09 per unit of risk. If you would invest 1,297 in Hengdian Entertainment Co on August 30, 2024 and sell it today you would earn a total of 348.00 from holding Hengdian Entertainment Co or generate 26.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hengdian Entertainment Co vs. Shanghai Yaohua Pilkington
Performance |
| Timeline |
| Hengdian Entertainment |
| Shanghai Yaohua Pilk |
Hengdian Entertainment and Shanghai Yaohua Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hengdian Entertainment and Shanghai Yaohua
The main advantage of trading using opposite Hengdian Entertainment and Shanghai Yaohua positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hengdian Entertainment position performs unexpectedly, Shanghai Yaohua 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 Yaohua will offset losses from the drop in Shanghai Yaohua's long position.| Hengdian Entertainment vs. Ming Yang Smart | Hengdian Entertainment vs. 159681 | Hengdian Entertainment vs. 159005 | Hengdian Entertainment vs. 516220 |
| Shanghai Yaohua vs. Zijin Mining Group | Shanghai Yaohua vs. Wanhua Chemical Group | Shanghai Yaohua vs. Baoshan Iron Steel | Shanghai Yaohua vs. Shandong Gold Mining |
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 Search module to search for actively traded equities including funds and ETFs from over 30 global markets.
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