Correlation Between Shanghai Action and HaiXin Foods
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By analyzing existing cross correlation between Shanghai Action Education and HaiXin Foods Co, you can compare the effects of market volatilities on Shanghai Action and HaiXin 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 Shanghai Action with a short position of HaiXin Foods. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Action and HaiXin Foods.
Diversification Opportunities for Shanghai Action and HaiXin Foods
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Shanghai and HaiXin is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Action Education and HaiXin Foods Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HaiXin Foods and Shanghai Action 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 Action Education are associated (or correlated) with HaiXin Foods. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HaiXin Foods has no effect on the direction of Shanghai Action i.e., Shanghai Action and HaiXin Foods go up and down completely randomly.
Pair Corralation between Shanghai Action and HaiXin Foods
Assuming the 90 days trading horizon Shanghai Action Education is expected to generate 1.02 times more return on investment than HaiXin Foods. However, Shanghai Action is 1.02 times more volatile than HaiXin Foods Co. It trades about 0.04 of its potential returns per unit of risk. HaiXin Foods Co is currently generating about 0.0 per unit of risk. If you would invest 2,541 in Shanghai Action Education on September 12, 2024 and sell it today you would earn a total of 1,112 from holding Shanghai Action Education or generate 43.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Action Education vs. HaiXin Foods Co
Performance |
| Timeline |
| Shanghai Action Education |
| HaiXin Foods |
Shanghai Action and HaiXin Foods Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Action and HaiXin Foods
The main advantage of trading using opposite Shanghai Action and HaiXin Foods positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Action position performs unexpectedly, HaiXin 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 HaiXin Foods will offset losses from the drop in HaiXin Foods' long position.| Shanghai Action vs. Lutian Machinery Co | Shanghai Action vs. PetroChina Co Ltd | Shanghai Action vs. Bank of China | Shanghai Action vs. Gansu Jiu Steel |
| HaiXin Foods vs. China Petroleum Chemical | HaiXin Foods vs. PetroChina Co Ltd | HaiXin Foods vs. China State Construction | HaiXin Foods vs. China Railway Group |
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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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