Correlation Between Shanghai Yanpu and Zhejiang Yongjin
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By analyzing existing cross correlation between Shanghai Yanpu Metal and Zhejiang Yongjin Metal, you can compare the effects of market volatilities on Shanghai Yanpu and Zhejiang Yongjin 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 Zhejiang Yongjin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Yanpu and Zhejiang Yongjin.
Diversification Opportunities for Shanghai Yanpu and Zhejiang Yongjin
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shanghai and Zhejiang is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Yanpu Metal and Zhejiang Yongjin Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Yongjin Metal 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 Zhejiang Yongjin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Yongjin Metal has no effect on the direction of Shanghai Yanpu i.e., Shanghai Yanpu and Zhejiang Yongjin go up and down completely randomly.
Pair Corralation between Shanghai Yanpu and Zhejiang Yongjin
Assuming the 90 days trading horizon Shanghai Yanpu Metal is expected to generate 1.71 times more return on investment than Zhejiang Yongjin. However, Shanghai Yanpu is 1.71 times more volatile than Zhejiang Yongjin Metal. It trades about 0.08 of its potential returns per unit of risk. Zhejiang Yongjin Metal is currently generating about -0.19 per unit of risk. If you would invest 3,694 in Shanghai Yanpu Metal on August 28, 2024 and sell it today you would earn a total of 173.00 from holding Shanghai Yanpu Metal or generate 4.68% 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. Zhejiang Yongjin Metal
Performance |
| Timeline |
| Shanghai Yanpu Metal |
| Zhejiang Yongjin Metal |
Shanghai Yanpu and Zhejiang Yongjin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Yanpu and Zhejiang Yongjin
The main advantage of trading using opposite Shanghai Yanpu and Zhejiang Yongjin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Yanpu position performs unexpectedly, Zhejiang Yongjin 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 Zhejiang Yongjin will offset losses from the drop in Zhejiang Yongjin's long position.| Shanghai Yanpu vs. Loongson Technology Corp | Shanghai Yanpu vs. Chongqing Road Bridge | Shanghai Yanpu vs. Shenzhen Fortune Trend | Shanghai Yanpu vs. Wuhan Xianglong Power |
| Zhejiang Yongjin vs. Wanhua Chemical Group | Zhejiang Yongjin vs. Shandong Gold Mining | Zhejiang Yongjin vs. Rongsheng Petrochemical Co | Zhejiang Yongjin vs. Inner Mongolia BaoTou |
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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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