Correlation Between Shuhua Sports and Bus Online
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By analyzing existing cross correlation between Shuhua Sports Co and Bus Online Co, you can compare the effects of market volatilities on Shuhua Sports and Bus Online 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 Bus Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shuhua Sports and Bus Online.
Diversification Opportunities for Shuhua Sports and Bus Online
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shuhua and Bus is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Shuhua Sports Co and Bus Online Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bus Online 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 Bus Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bus Online has no effect on the direction of Shuhua Sports i.e., Shuhua Sports and Bus Online go up and down completely randomly.
Pair Corralation between Shuhua Sports and Bus Online
Assuming the 90 days trading horizon Shuhua Sports is expected to generate 1.08 times less return on investment than Bus Online. But when comparing it to its historical volatility, Shuhua Sports Co is 1.12 times less risky than Bus Online. It trades about 0.16 of its potential returns per unit of risk. Bus Online Co is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 401.00 in Bus Online Co on September 3, 2024 and sell it today you would earn a total of 105.00 from holding Bus Online Co or generate 26.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shuhua Sports Co vs. Bus Online Co
Performance |
| Timeline |
| Shuhua Sports |
| Bus Online |
Shuhua Sports and Bus Online Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shuhua Sports and Bus Online
The main advantage of trading using opposite Shuhua Sports and Bus Online positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shuhua Sports position performs unexpectedly, Bus Online 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 Bus Online will offset losses from the drop in Bus Online's long position.| Shuhua Sports vs. PetroChina Co Ltd | Shuhua Sports vs. China Mobile Limited | Shuhua Sports vs. Industrial and Commercial | Shuhua Sports vs. China Life Insurance |
| Bus Online vs. Anhui Transport Consulting | Bus Online vs. Sino Platinum Metals Co | Bus Online vs. Guangdong Jingyi Metal | Bus Online vs. China Aluminum International |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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