Correlation Between Shanghai Laimu and Xingguang Agricultural
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By analyzing existing cross correlation between Shanghai Laimu Electronics and Xingguang Agricultural Mach, you can compare the effects of market volatilities on Shanghai Laimu and Xingguang Agricultural 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 Laimu with a short position of Xingguang Agricultural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Laimu and Xingguang Agricultural.
Diversification Opportunities for Shanghai Laimu and Xingguang Agricultural
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Shanghai and Xingguang is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Laimu Electronics and Xingguang Agricultural Mach in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xingguang Agricultural and Shanghai Laimu 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 Laimu Electronics are associated (or correlated) with Xingguang Agricultural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xingguang Agricultural has no effect on the direction of Shanghai Laimu i.e., Shanghai Laimu and Xingguang Agricultural go up and down completely randomly.
Pair Corralation between Shanghai Laimu and Xingguang Agricultural
Assuming the 90 days trading horizon Shanghai Laimu Electronics is expected to generate 1.46 times more return on investment than Xingguang Agricultural. However, Shanghai Laimu is 1.46 times more volatile than Xingguang Agricultural Mach. It trades about 0.04 of its potential returns per unit of risk. Xingguang Agricultural Mach is currently generating about -0.26 per unit of risk. If you would invest 809.00 in Shanghai Laimu Electronics on October 23, 2024 and sell it today you would earn a total of 14.00 from holding Shanghai Laimu Electronics or generate 1.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Shanghai Laimu Electronics vs. Xingguang Agricultural Mach
Performance |
| Timeline |
| Shanghai Laimu Elect |
| Xingguang Agricultural |
Shanghai Laimu and Xingguang Agricultural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Laimu and Xingguang Agricultural
The main advantage of trading using opposite Shanghai Laimu and Xingguang Agricultural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Laimu position performs unexpectedly, Xingguang Agricultural 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 Xingguang Agricultural will offset losses from the drop in Xingguang Agricultural's long position.| Shanghai Laimu vs. Shaanxi Meineng Clean | Shanghai Laimu vs. Orinko Advanced Plastics | Shanghai Laimu vs. Quectel Wireless Solutions | Shanghai Laimu vs. Ningbo Tip Rubber |
| Xingguang Agricultural vs. PetroChina Co Ltd | Xingguang Agricultural vs. Industrial and Commercial | Xingguang Agricultural vs. China Petroleum Chemical | Xingguang Agricultural vs. China Construction Bank |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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