Correlation Between Juewei Food and Shanghai Material
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By analyzing existing cross correlation between Juewei Food Co and Shanghai Material Trading, you can compare the effects of market volatilities on Juewei Food and Shanghai Material 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 Juewei Food with a short position of Shanghai Material. Check out your portfolio center. Please also check ongoing floating volatility patterns of Juewei Food and Shanghai Material.
Diversification Opportunities for Juewei Food and Shanghai Material
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Juewei and Shanghai is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Juewei Food Co and Shanghai Material Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Material Trading and Juewei Food 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 Juewei Food Co are associated (or correlated) with Shanghai Material. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Material Trading has no effect on the direction of Juewei Food i.e., Juewei Food and Shanghai Material go up and down completely randomly.
Pair Corralation between Juewei Food and Shanghai Material
Assuming the 90 days trading horizon Juewei Food Co is expected to under-perform the Shanghai Material. But the stock apears to be less risky and, when comparing its historical volatility, Juewei Food Co is 1.21 times less risky than Shanghai Material. The stock trades about -0.09 of its potential returns per unit of risk. The Shanghai Material Trading is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 811.00 in Shanghai Material Trading on October 16, 2024 and sell it today you would earn a total of 149.00 from holding Shanghai Material Trading or generate 18.37% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Juewei Food Co vs. Shanghai Material Trading
Performance |
| Timeline |
| Juewei Food |
| Shanghai Material Trading |
Juewei Food and Shanghai Material Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Juewei Food and Shanghai Material
The main advantage of trading using opposite Juewei Food and Shanghai Material positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Juewei Food position performs unexpectedly, Shanghai Material 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 Material will offset losses from the drop in Shanghai Material's long position.| Juewei Food vs. Shenyang Blue Silver | Juewei Food vs. Uroica Mining Safety | Juewei Food vs. Shenzhen Silver Basis | Juewei Food vs. Shengda Mining Co |
| Shanghai Material vs. Anji Foodstuff Co | Shanghai Material vs. Juewei Food Co | Shanghai Material vs. Wuhan Yangtze Communication | Shanghai Material vs. Zhongyin Babi Food |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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