Correlation Between Shanghai Yanpu and Qingdao Rural
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By analyzing existing cross correlation between Shanghai Yanpu Metal and Qingdao Rural Commercial, you can compare the effects of market volatilities on Shanghai Yanpu and Qingdao Rural 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 Qingdao Rural. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Yanpu and Qingdao Rural.
Diversification Opportunities for Shanghai Yanpu and Qingdao Rural
0.51 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shanghai and Qingdao is 0.51. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Yanpu Metal and Qingdao Rural Commercial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qingdao Rural Commercial 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 Qingdao Rural. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qingdao Rural Commercial has no effect on the direction of Shanghai Yanpu i.e., Shanghai Yanpu and Qingdao Rural go up and down completely randomly.
Pair Corralation between Shanghai Yanpu and Qingdao Rural
Assuming the 90 days trading horizon Shanghai Yanpu Metal is expected to generate 1.28 times more return on investment than Qingdao Rural. However, Shanghai Yanpu is 1.28 times more volatile than Qingdao Rural Commercial. It trades about -0.09 of its potential returns per unit of risk. Qingdao Rural Commercial is currently generating about -0.31 per unit of risk. If you would invest 3,788 in Shanghai Yanpu Metal on October 7, 2024 and sell it today you would lose (139.00) from holding Shanghai Yanpu Metal or give up 3.67% 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. Qingdao Rural Commercial
Performance |
| Timeline |
| Shanghai Yanpu Metal |
| Qingdao Rural Commercial |
Shanghai Yanpu and Qingdao Rural Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Yanpu and Qingdao Rural
The main advantage of trading using opposite Shanghai Yanpu and Qingdao Rural positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Yanpu position performs unexpectedly, Qingdao Rural 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 Qingdao Rural will offset losses from the drop in Qingdao Rural's long position.| Shanghai Yanpu vs. Agricultural Bank of | Shanghai Yanpu vs. Postal Savings Bank | Shanghai Yanpu vs. Gansu Jiu Steel | Shanghai Yanpu vs. Shandong Mining Machinery |
| Qingdao Rural vs. Chengdu Xingrong Investment | Qingdao Rural vs. Beijing Mainstreets Investment | Qingdao Rural vs. TianJin 712 Communication | Qingdao Rural vs. Zhongrun Resources Investment |
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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