Correlation Between Shanghai Yanpu and Xiandai Investment
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By analyzing existing cross correlation between Shanghai Yanpu Metal and Xiandai Investment Co, you can compare the effects of market volatilities on Shanghai Yanpu and Xiandai Investment 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 Xiandai Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Yanpu and Xiandai Investment.
Diversification Opportunities for Shanghai Yanpu and Xiandai Investment
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shanghai and Xiandai is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Yanpu Metal and Xiandai Investment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiandai Investment 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 Xiandai Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiandai Investment has no effect on the direction of Shanghai Yanpu i.e., Shanghai Yanpu and Xiandai Investment go up and down completely randomly.
Pair Corralation between Shanghai Yanpu and Xiandai Investment
Assuming the 90 days trading horizon Shanghai Yanpu Metal is expected to generate 1.89 times more return on investment than Xiandai Investment. However, Shanghai Yanpu is 1.89 times more volatile than Xiandai Investment Co. It trades about 0.01 of its potential returns per unit of risk. Xiandai Investment Co is currently generating about 0.01 per unit of risk. If you would invest 3,684 in Shanghai Yanpu Metal on October 14, 2024 and sell it today you would lose (9.00) from holding Shanghai Yanpu Metal or give up 0.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Yanpu Metal vs. Xiandai Investment Co
Performance |
| Timeline |
| Shanghai Yanpu Metal |
| Xiandai Investment |
Shanghai Yanpu and Xiandai Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Yanpu and Xiandai Investment
The main advantage of trading using opposite Shanghai Yanpu and Xiandai Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Yanpu position performs unexpectedly, Xiandai Investment 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 Xiandai Investment will offset losses from the drop in Xiandai Investment's long position.| Shanghai Yanpu vs. Easyhome New Retail | Shanghai Yanpu vs. China Sports Industry | Shanghai Yanpu vs. AUPU Home Style | Shanghai Yanpu vs. Hunan Mendale Hometextile |
| Xiandai Investment vs. Shandong Hongchuang Aluminum | Xiandai Investment vs. Shanghai Yanpu Metal | Xiandai Investment vs. Zhejiang Yongjin Metal | Xiandai Investment vs. Inspur Software Co |
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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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