Correlation Between Shanghai Yanpu and Jiangsu GDK
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By analyzing existing cross correlation between Shanghai Yanpu Metal and Jiangsu GDK Biotechnology, you can compare the effects of market volatilities on Shanghai Yanpu and Jiangsu GDK 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 Jiangsu GDK. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Yanpu and Jiangsu GDK.
Diversification Opportunities for Shanghai Yanpu and Jiangsu GDK
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shanghai and Jiangsu is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Yanpu Metal and Jiangsu GDK Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu GDK Biotechnology 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 Jiangsu GDK. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu GDK Biotechnology has no effect on the direction of Shanghai Yanpu i.e., Shanghai Yanpu and Jiangsu GDK go up and down completely randomly.
Pair Corralation between Shanghai Yanpu and Jiangsu GDK
Assuming the 90 days trading horizon Shanghai Yanpu Metal is expected to generate 0.83 times more return on investment than Jiangsu GDK. However, Shanghai Yanpu Metal is 1.21 times less risky than Jiangsu GDK. It trades about 0.05 of its potential returns per unit of risk. Jiangsu GDK Biotechnology is currently generating about -0.03 per unit of risk. If you would invest 2,828 in Shanghai Yanpu Metal on September 12, 2024 and sell it today you would earn a total of 1,059 from holding Shanghai Yanpu Metal or generate 37.45% 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. Jiangsu GDK Biotechnology
Performance |
| Timeline |
| Shanghai Yanpu Metal |
| Jiangsu GDK Biotechnology |
Shanghai Yanpu and Jiangsu GDK Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Yanpu and Jiangsu GDK
The main advantage of trading using opposite Shanghai Yanpu and Jiangsu GDK positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Yanpu position performs unexpectedly, Jiangsu GDK 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 Jiangsu GDK will offset losses from the drop in Jiangsu GDK's long position.| Shanghai Yanpu vs. Lutian Machinery Co | Shanghai Yanpu vs. PetroChina Co Ltd | Shanghai Yanpu vs. Bank of China | Shanghai Yanpu vs. Gansu Jiu Steel |
| Jiangsu GDK vs. Yunnan Xiyi Industrial | Jiangsu GDK vs. Sichuan Fulin Transportation | Jiangsu GDK vs. Anhui Transport Consulting | Jiangsu GDK vs. Lonkey Industrial 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 Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
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