Correlation Between Eastroc Beverage and Shandong Longquan
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By analyzing existing cross correlation between Eastroc Beverage Group and Shandong Longquan Pipeline, you can compare the effects of market volatilities on Eastroc Beverage and Shandong Longquan 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 Eastroc Beverage with a short position of Shandong Longquan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Eastroc Beverage and Shandong Longquan.
Diversification Opportunities for Eastroc Beverage and Shandong Longquan
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between Eastroc and Shandong is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding Eastroc Beverage Group and Shandong Longquan Pipeline in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Longquan and Eastroc Beverage 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 Eastroc Beverage Group are associated (or correlated) with Shandong Longquan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Longquan has no effect on the direction of Eastroc Beverage i.e., Eastroc Beverage and Shandong Longquan go up and down completely randomly.
Pair Corralation between Eastroc Beverage and Shandong Longquan
Assuming the 90 days trading horizon Eastroc Beverage Group is expected to generate 1.0 times more return on investment than Shandong Longquan. However, Eastroc Beverage is 1.0 times more volatile than Shandong Longquan Pipeline. It trades about 0.08 of its potential returns per unit of risk. Shandong Longquan Pipeline is currently generating about 0.05 per unit of risk. If you would invest 22,048 in Eastroc Beverage Group on October 26, 2024 and sell it today you would earn a total of 2,231 from holding Eastroc Beverage Group or generate 10.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Eastroc Beverage Group vs. Shandong Longquan Pipeline
Performance |
| Timeline |
| Eastroc Beverage |
| Shandong Longquan |
Eastroc Beverage and Shandong Longquan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Eastroc Beverage and Shandong Longquan
The main advantage of trading using opposite Eastroc Beverage and Shandong Longquan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Eastroc Beverage position performs unexpectedly, Shandong Longquan 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 Shandong Longquan will offset losses from the drop in Shandong Longquan's long position.| Eastroc Beverage vs. Agricultural Bank of | Eastroc Beverage vs. Industrial and Commercial | Eastroc Beverage vs. Bank of China | Eastroc Beverage vs. China Construction Bank |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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