Correlation Between Shanghai Action and Zhongjing Food
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By analyzing existing cross correlation between Shanghai Action Education and Zhongjing Food Co, you can compare the effects of market volatilities on Shanghai Action and Zhongjing Food 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 Zhongjing Food. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Action and Zhongjing Food.
Diversification Opportunities for Shanghai Action and Zhongjing Food
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shanghai and Zhongjing is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Action Education and Zhongjing Food Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongjing Food 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 Zhongjing Food. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongjing Food has no effect on the direction of Shanghai Action i.e., Shanghai Action and Zhongjing Food go up and down completely randomly.
Pair Corralation between Shanghai Action and Zhongjing Food
Assuming the 90 days trading horizon Shanghai Action Education is expected to generate 1.47 times more return on investment than Zhongjing Food. However, Shanghai Action is 1.47 times more volatile than Zhongjing Food Co. It trades about 0.24 of its potential returns per unit of risk. Zhongjing Food Co is currently generating about 0.01 per unit of risk. If you would invest 3,764 in Shanghai Action Education on December 8, 2024 and sell it today you would earn a total of 497.00 from holding Shanghai Action Education or generate 13.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Action Education vs. Zhongjing Food Co
Performance |
| Timeline |
| Shanghai Action Education |
| Zhongjing Food |
Shanghai Action and Zhongjing Food Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Action and Zhongjing Food
The main advantage of trading using opposite Shanghai Action and Zhongjing Food positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Action position performs unexpectedly, Zhongjing Food 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 Zhongjing Food will offset losses from the drop in Zhongjing Food's long position.| Shanghai Action vs. Touchstone International Medical | ||
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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 Positions Ratings module to determine portfolio positions ratings based on digital equity recommendations. Macroaxis instant position ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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