Correlation Between Beijing Wantai and Yunnan Yuntou
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By analyzing existing cross correlation between Beijing Wantai Biological and Yunnan Yuntou Ecology, you can compare the effects of market volatilities on Beijing Wantai and Yunnan Yuntou 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 Beijing Wantai with a short position of Yunnan Yuntou. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Wantai and Yunnan Yuntou.
Diversification Opportunities for Beijing Wantai and Yunnan Yuntou
0.53 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Beijing and Yunnan is 0.53. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Wantai Biological and Yunnan Yuntou Ecology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yunnan Yuntou Ecology and Beijing Wantai 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 Beijing Wantai Biological are associated (or correlated) with Yunnan Yuntou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yunnan Yuntou Ecology has no effect on the direction of Beijing Wantai i.e., Beijing Wantai and Yunnan Yuntou go up and down completely randomly.
Pair Corralation between Beijing Wantai and Yunnan Yuntou
Assuming the 90 days trading horizon Beijing Wantai Biological is expected to generate 1.38 times more return on investment than Yunnan Yuntou. However, Beijing Wantai is 1.38 times more volatile than Yunnan Yuntou Ecology. It trades about -0.01 of its potential returns per unit of risk. Yunnan Yuntou Ecology is currently generating about -0.02 per unit of risk. If you would invest 10,536 in Beijing Wantai Biological on August 24, 2024 and sell it today you would lose (3,219) from holding Beijing Wantai Biological or give up 30.55% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Wantai Biological vs. Yunnan Yuntou Ecology
Performance |
| Timeline |
| Beijing Wantai Biological |
| Yunnan Yuntou Ecology |
Beijing Wantai and Yunnan Yuntou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Wantai and Yunnan Yuntou
The main advantage of trading using opposite Beijing Wantai and Yunnan Yuntou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Wantai position performs unexpectedly, Yunnan Yuntou 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 Yunnan Yuntou will offset losses from the drop in Yunnan Yuntou's long position.| Beijing Wantai vs. China State Construction | Beijing Wantai vs. Poly Real Estate | Beijing Wantai vs. China Vanke Co | Beijing Wantai vs. China Merchants Shekou |
| Yunnan Yuntou vs. Chengdu Kanghua Biological | Yunnan Yuntou vs. Beijing Wantai Biological | Yunnan Yuntou vs. Suzhou Novoprotein Scientific | Yunnan Yuntou vs. Aluminum Corp of |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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