Correlation Between Shanghai Rongtai and Gan Yuan
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By analyzing existing cross correlation between Shanghai Rongtai Health and Gan Yuan Foods, you can compare the effects of market volatilities on Shanghai Rongtai and Gan Yuan 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 Shanghai Rongtai with a short position of Gan Yuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Rongtai and Gan Yuan.
Diversification Opportunities for Shanghai Rongtai and Gan Yuan
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Shanghai and Gan is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Rongtai Health and Gan Yuan Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gan Yuan Foods and Shanghai Rongtai 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 Shanghai Rongtai Health are associated (or correlated) with Gan Yuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gan Yuan Foods has no effect on the direction of Shanghai Rongtai i.e., Shanghai Rongtai and Gan Yuan go up and down completely randomly.
Pair Corralation between Shanghai Rongtai and Gan Yuan
Assuming the 90 days trading horizon Shanghai Rongtai Health is expected to generate 0.65 times more return on investment than Gan Yuan. However, Shanghai Rongtai Health is 1.54 times less risky than Gan Yuan. It trades about -0.07 of its potential returns per unit of risk. Gan Yuan Foods is currently generating about -0.11 per unit of risk. If you would invest 1,450 in Shanghai Rongtai Health on November 1, 2024 and sell it today you would lose (42.00) from holding Shanghai Rongtai Health or give up 2.9% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Rongtai Health vs. Gan Yuan Foods
Performance |
| Timeline |
| Shanghai Rongtai Health |
| Gan Yuan Foods |
Shanghai Rongtai and Gan Yuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Rongtai and Gan Yuan
The main advantage of trading using opposite Shanghai Rongtai and Gan Yuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Rongtai position performs unexpectedly, Gan Yuan 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 Gan Yuan will offset losses from the drop in Gan Yuan's long position.| Shanghai Rongtai vs. Liaoning Chengda Biotechnology | Shanghai Rongtai vs. Bloomage Biotechnology Corp | Shanghai Rongtai vs. Anhui Tongguan Copper | Shanghai Rongtai vs. Shenyang Huitian Thermal |
| Gan Yuan vs. Shanghai Rongtai Health | Gan Yuan vs. PKU HealthCare Corp | Gan Yuan vs. Chongqing Brewery Co | Gan Yuan vs. Beijing Yanjing Brewery |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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