Correlation Between Shanghai Yanpu and Shenzhen Bioeasy
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By analyzing existing cross correlation between Shanghai Yanpu Metal and Shenzhen Bioeasy Biotechnology, you can compare the effects of market volatilities on Shanghai Yanpu and Shenzhen Bioeasy 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 Shenzhen Bioeasy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Yanpu and Shenzhen Bioeasy.
Diversification Opportunities for Shanghai Yanpu and Shenzhen Bioeasy
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shanghai and Shenzhen is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Yanpu Metal and Shenzhen Bioeasy Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Bioeasy Bio 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 Shenzhen Bioeasy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Bioeasy Bio has no effect on the direction of Shanghai Yanpu i.e., Shanghai Yanpu and Shenzhen Bioeasy go up and down completely randomly.
Pair Corralation between Shanghai Yanpu and Shenzhen Bioeasy
Assuming the 90 days trading horizon Shanghai Yanpu Metal is expected to generate 0.56 times more return on investment than Shenzhen Bioeasy. However, Shanghai Yanpu Metal is 1.8 times less risky than Shenzhen Bioeasy. It trades about -0.15 of its potential returns per unit of risk. Shenzhen Bioeasy Biotechnology is currently generating about -0.14 per unit of risk. If you would invest 4,038 in Shanghai Yanpu Metal on October 30, 2024 and sell it today you would lose (411.00) from holding Shanghai Yanpu Metal or give up 10.18% 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. Shenzhen Bioeasy Biotechnology
Performance |
| Timeline |
| Shanghai Yanpu Metal |
| Shenzhen Bioeasy Bio |
Shanghai Yanpu and Shenzhen Bioeasy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Yanpu and Shenzhen Bioeasy
The main advantage of trading using opposite Shanghai Yanpu and Shenzhen Bioeasy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Yanpu position performs unexpectedly, Shenzhen Bioeasy 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 Shenzhen Bioeasy will offset losses from the drop in Shenzhen Bioeasy's long position.| Shanghai Yanpu vs. Kweichow Moutai Co | Shanghai Yanpu vs. Jiangsu Pacific Quartz | Shanghai Yanpu vs. Shenzhen Transsion Holdings | Shanghai Yanpu vs. Beijing Roborock Technology |
| Shenzhen Bioeasy vs. Anyang Iron Steel | Shenzhen Bioeasy vs. Qingdao Foods Co | Shenzhen Bioeasy vs. New Hope Dairy | Shenzhen Bioeasy vs. Anji Foodstuff 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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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