Correlation Between Shanghai Yanpu and Zhongshan Public
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By analyzing existing cross correlation between Shanghai Yanpu Metal and Zhongshan Public Utilities, you can compare the effects of market volatilities on Shanghai Yanpu and Zhongshan Public 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 Yanpu with a short position of Zhongshan Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Yanpu and Zhongshan Public.
Diversification Opportunities for Shanghai Yanpu and Zhongshan Public
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shanghai and Zhongshan is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Yanpu Metal and Zhongshan Public Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongshan Public Uti and Shanghai Yanpu 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 Yanpu Metal are associated (or correlated) with Zhongshan Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongshan Public Uti has no effect on the direction of Shanghai Yanpu i.e., Shanghai Yanpu and Zhongshan Public go up and down completely randomly.
Pair Corralation between Shanghai Yanpu and Zhongshan Public
Assuming the 90 days trading horizon Shanghai Yanpu Metal is expected to generate 1.78 times more return on investment than Zhongshan Public. However, Shanghai Yanpu is 1.78 times more volatile than Zhongshan Public Utilities. It trades about 0.12 of its potential returns per unit of risk. Zhongshan Public Utilities is currently generating about 0.02 per unit of risk. If you would invest 3,759 in Shanghai Yanpu Metal on September 1, 2024 and sell it today you would earn a total of 279.00 from holding Shanghai Yanpu Metal or generate 7.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Yanpu Metal vs. Zhongshan Public Utilities
Performance |
| Timeline |
| Shanghai Yanpu Metal |
| Zhongshan Public Uti |
Shanghai Yanpu and Zhongshan Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Yanpu and Zhongshan Public
The main advantage of trading using opposite Shanghai Yanpu and Zhongshan Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Yanpu position performs unexpectedly, Zhongshan Public 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 Zhongshan Public will offset losses from the drop in Zhongshan Public's long position.| Shanghai Yanpu vs. BYD Co Ltd | Shanghai Yanpu vs. China Mobile Limited | Shanghai Yanpu vs. Agricultural Bank of | Shanghai Yanpu vs. Industrial and Commercial |
| Zhongshan Public vs. Anhui Fuhuang Steel | Zhongshan Public vs. Gansu Jiu Steel | Zhongshan Public vs. Fujian Nanwang Environment | Zhongshan Public vs. Yindu Kitchen Equipment |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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