Correlation Between Youyou Foods and Qingdao Foods
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By analyzing existing cross correlation between Youyou Foods Co and Qingdao Foods Co, you can compare the effects of market volatilities on Youyou Foods and Qingdao Foods 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 Youyou Foods with a short position of Qingdao Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Youyou Foods and Qingdao Foods.
Diversification Opportunities for Youyou Foods and Qingdao Foods
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Youyou and Qingdao is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Youyou Foods Co and Qingdao Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qingdao Foods and Youyou Foods 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 Youyou Foods Co are associated (or correlated) with Qingdao Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qingdao Foods has no effect on the direction of Youyou Foods i.e., Youyou Foods and Qingdao Foods go up and down completely randomly.
Pair Corralation between Youyou Foods and Qingdao Foods
Assuming the 90 days trading horizon Youyou Foods Co is expected to generate 1.28 times more return on investment than Qingdao Foods. However, Youyou Foods is 1.28 times more volatile than Qingdao Foods Co. It trades about 0.3 of its potential returns per unit of risk. Qingdao Foods Co is currently generating about 0.21 per unit of risk. If you would invest 560.00 in Youyou Foods Co on September 12, 2024 and sell it today you would earn a total of 518.00 from holding Youyou Foods Co or generate 92.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 98.28% |
| Values | Daily Returns |
Youyou Foods Co vs. Qingdao Foods Co
Performance |
| Timeline |
| Youyou Foods |
| Qingdao Foods |
Youyou Foods and Qingdao Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Youyou Foods and Qingdao Foods
The main advantage of trading using opposite Youyou Foods and Qingdao Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Youyou Foods position performs unexpectedly, Qingdao Foods 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 Qingdao Foods will offset losses from the drop in Qingdao Foods' long position.| Youyou Foods vs. Nanjing Putian Telecommunications | Youyou Foods vs. Tianjin Realty Development | Youyou Foods vs. Kangyue Technology Co | Youyou Foods vs. Shenzhen Hifuture Electric |
| Qingdao Foods vs. Zhejiang Xiantong RubberPlastic | Qingdao Foods vs. King Strong New Material | Qingdao Foods vs. Cangzhou Mingzhu Plastic | Qingdao Foods vs. Tonghua Grape Wine |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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