Correlation Between Shuhua Sports and China State
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By analyzing existing cross correlation between Shuhua Sports Co and China State Construction, you can compare the effects of market volatilities on Shuhua Sports and China State 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 State. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shuhua Sports and China State.
Diversification Opportunities for Shuhua Sports and China State
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shuhua and China is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Shuhua Sports Co and China State Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China State Construction 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 State. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China State Construction has no effect on the direction of Shuhua Sports i.e., Shuhua Sports and China State go up and down completely randomly.
Pair Corralation between Shuhua Sports and China State
Assuming the 90 days trading horizon Shuhua Sports Co is expected to generate 1.05 times more return on investment than China State. However, Shuhua Sports is 1.05 times more volatile than China State Construction. It trades about 0.26 of its potential returns per unit of risk. China State Construction is currently generating about -0.01 per unit of risk. If you would invest 753.00 in Shuhua Sports Co on August 31, 2024 and sell it today you would earn a total of 93.00 from holding Shuhua Sports Co or generate 12.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shuhua Sports Co vs. China State Construction
Performance |
| Timeline |
| Shuhua Sports |
| China State Construction |
Shuhua Sports and China State Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shuhua Sports and China State
The main advantage of trading using opposite Shuhua Sports and China State positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shuhua Sports position performs unexpectedly, China State 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 State will offset losses from the drop in China State's long position.| Shuhua Sports vs. China State Construction | Shuhua Sports vs. China Merchants Shekou | Shuhua Sports vs. Huafa Industrial Co | Shuhua Sports vs. China International Capital |
| China State vs. Guangdong Wens Foodstuff | China State vs. Great Sun Foods Co | China State vs. Tianjin Pengling Rubber | China State vs. Suzhou Xingye Material |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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