Correlation Between Shanghai Action and Industrial Securities
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By analyzing existing cross correlation between Shanghai Action Education and Industrial Securities Co, you can compare the effects of market volatilities on Shanghai Action and Industrial Securities 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 Industrial Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Action and Industrial Securities.
Diversification Opportunities for Shanghai Action and Industrial Securities
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shanghai and Industrial is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Action Education and Industrial Securities Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industrial Securities 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 Industrial Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industrial Securities has no effect on the direction of Shanghai Action i.e., Shanghai Action and Industrial Securities go up and down completely randomly.
Pair Corralation between Shanghai Action and Industrial Securities
Assuming the 90 days trading horizon Shanghai Action Education is expected to generate 2.09 times more return on investment than Industrial Securities. However, Shanghai Action is 2.09 times more volatile than Industrial Securities Co. It trades about 0.06 of its potential returns per unit of risk. Industrial Securities Co is currently generating about -0.22 per unit of risk. If you would invest 3,555 in Shanghai Action Education on September 12, 2024 and sell it today you would earn a total of 98.00 from holding Shanghai Action Education or generate 2.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Action Education vs. Industrial Securities Co
Performance |
| Timeline |
| Shanghai Action Education |
| Industrial Securities |
Shanghai Action and Industrial Securities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Action and Industrial Securities
The main advantage of trading using opposite Shanghai Action and Industrial Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Action position performs unexpectedly, Industrial Securities 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 Industrial Securities will offset losses from the drop in Industrial Securities' 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 |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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