Correlation Between Shuhua Sports and China Merchants
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By analyzing existing cross correlation between Shuhua Sports Co and China Merchants Shekou, you can compare the effects of market volatilities on Shuhua Sports and China Merchants 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 Shuhua Sports with a short position of China Merchants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shuhua Sports and China Merchants.
Diversification Opportunities for Shuhua Sports and China Merchants
-0.21 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Shuhua and China is -0.21. Overlapping area represents the amount of risk that can be diversified away by holding Shuhua Sports Co and China Merchants Shekou in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Merchants Shekou and Shuhua Sports 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 Shuhua Sports Co are associated (or correlated) with China Merchants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Merchants Shekou has no effect on the direction of Shuhua Sports i.e., Shuhua Sports and China Merchants go up and down completely randomly.
Pair Corralation between Shuhua Sports and China Merchants
Assuming the 90 days trading horizon Shuhua Sports Co is expected to generate 2.14 times more return on investment than China Merchants. However, Shuhua Sports is 2.14 times more volatile than China Merchants Shekou. It trades about -0.02 of its potential returns per unit of risk. China Merchants Shekou is currently generating about -0.28 per unit of risk. If you would invest 859.00 in Shuhua Sports Co on October 30, 2024 and sell it today you would lose (44.00) from holding Shuhua Sports Co or give up 5.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shuhua Sports Co vs. China Merchants Shekou
Performance |
| Timeline |
| Shuhua Sports |
| China Merchants Shekou |
Shuhua Sports and China Merchants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shuhua Sports and China Merchants
The main advantage of trading using opposite Shuhua Sports and China Merchants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shuhua Sports position performs unexpectedly, China Merchants 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 China Merchants will offset losses from the drop in China Merchants' long position.| Shuhua Sports vs. Cabio Biotech Wuhan | Shuhua Sports vs. Beijing YanDong MicroElectronic | Shuhua Sports vs. Techshine Electronics Co | Shuhua Sports vs. Nantong Haixing Electronics |
| China Merchants vs. Dareway Software Co | China Merchants vs. Xiamen Jihong Package | China Merchants vs. Thunder Software Technology | China Merchants vs. Beijing Baolande Software |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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