Correlation Between Beijing Baolande and Shandong Longquan
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By analyzing existing cross correlation between Beijing Baolande Software and Shandong Longquan Pipeline, you can compare the effects of market volatilities on Beijing Baolande 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 Beijing Baolande with a short position of Shandong Longquan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Baolande and Shandong Longquan.
Diversification Opportunities for Beijing Baolande and Shandong Longquan
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Beijing and Shandong is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Baolande Software and Shandong Longquan Pipeline in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Longquan and Beijing Baolande 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 Beijing Baolande Software 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 Beijing Baolande i.e., Beijing Baolande and Shandong Longquan go up and down completely randomly.
Pair Corralation between Beijing Baolande and Shandong Longquan
Assuming the 90 days trading horizon Beijing Baolande Software is expected to under-perform the Shandong Longquan. In addition to that, Beijing Baolande is 2.68 times more volatile than Shandong Longquan Pipeline. It trades about -0.02 of its total potential returns per unit of risk. Shandong Longquan Pipeline is currently generating about 0.17 per unit of volatility. If you would invest 456.00 in Shandong Longquan Pipeline on October 29, 2024 and sell it today you would earn a total of 24.00 from holding Shandong Longquan Pipeline or generate 5.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Baolande Software vs. Shandong Longquan Pipeline
Performance |
| Timeline |
| Beijing Baolande Software |
| Shandong Longquan |
Beijing Baolande and Shandong Longquan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Baolande and Shandong Longquan
The main advantage of trading using opposite Beijing Baolande and Shandong Longquan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Baolande 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.| Beijing Baolande vs. Fujian Oriental Silver | Beijing Baolande vs. Huaibei Mining Holdings | Beijing Baolande vs. JCHX Mining Management | Beijing Baolande vs. Jiaozuo Wanfang Aluminum |
| Shandong Longquan vs. Anhui Tongguan Copper | Shandong Longquan vs. Hainan Mining Co | Shandong Longquan vs. Yili Chuanning Biotechnology | Shandong Longquan vs. Changchun BCHT Biotechnology |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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