Correlation Between Shandong Huifa and Beijing Sanyuan
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By analyzing existing cross correlation between Shandong Huifa Foodstuff and Beijing Sanyuan Foods, you can compare the effects of market volatilities on Shandong Huifa and Beijing Sanyuan 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 Shandong Huifa with a short position of Beijing Sanyuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Huifa and Beijing Sanyuan.
Diversification Opportunities for Shandong Huifa and Beijing Sanyuan
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shandong and Beijing is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Huifa Foodstuff and Beijing Sanyuan Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Sanyuan Foods and Shandong Huifa 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 Shandong Huifa Foodstuff are associated (or correlated) with Beijing Sanyuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Sanyuan Foods has no effect on the direction of Shandong Huifa i.e., Shandong Huifa and Beijing Sanyuan go up and down completely randomly.
Pair Corralation between Shandong Huifa and Beijing Sanyuan
Assuming the 90 days trading horizon Shandong Huifa Foodstuff is expected to generate 2.67 times more return on investment than Beijing Sanyuan. However, Shandong Huifa is 2.67 times more volatile than Beijing Sanyuan Foods. It trades about 0.12 of its potential returns per unit of risk. Beijing Sanyuan Foods is currently generating about 0.12 per unit of risk. If you would invest 1,002 in Shandong Huifa Foodstuff on September 5, 2024 and sell it today you would earn a total of 106.00 from holding Shandong Huifa Foodstuff or generate 10.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shandong Huifa Foodstuff vs. Beijing Sanyuan Foods
Performance |
| Timeline |
| Shandong Huifa Foodstuff |
| Beijing Sanyuan Foods |
Shandong Huifa and Beijing Sanyuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Huifa and Beijing Sanyuan
The main advantage of trading using opposite Shandong Huifa and Beijing Sanyuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Huifa position performs unexpectedly, Beijing Sanyuan 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 Beijing Sanyuan will offset losses from the drop in Beijing Sanyuan's long position.| Shandong Huifa vs. Poly Real Estate | Shandong Huifa vs. China Vanke Co | Shandong Huifa vs. China Merchants Shekou | Shandong Huifa vs. Huafa Industrial Co |
| Beijing Sanyuan vs. Xian International Medical | Beijing Sanyuan vs. Xinjiang Zhongtai Chemical | Beijing Sanyuan vs. Xilong Chemical Co | Beijing Sanyuan vs. North Huajin Chemical |
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 CEOs Directory module to screen CEOs from public companies around the world.
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