Correlation Between Beijing Baolande and Shanghai Rongtai
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By analyzing existing cross correlation between Beijing Baolande Software and Shanghai Rongtai Health, you can compare the effects of market volatilities on Beijing Baolande and Shanghai Rongtai 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 Shanghai Rongtai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Baolande and Shanghai Rongtai.
Diversification Opportunities for Beijing Baolande and Shanghai Rongtai
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Beijing and Shanghai is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Baolande Software and Shanghai Rongtai Health in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Rongtai Health 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 Shanghai Rongtai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Rongtai Health has no effect on the direction of Beijing Baolande i.e., Beijing Baolande and Shanghai Rongtai go up and down completely randomly.
Pair Corralation between Beijing Baolande and Shanghai Rongtai
Assuming the 90 days trading horizon Beijing Baolande Software is expected to generate 1.58 times more return on investment than Shanghai Rongtai. However, Beijing Baolande is 1.58 times more volatile than Shanghai Rongtai Health. It trades about 0.02 of its potential returns per unit of risk. Shanghai Rongtai Health is currently generating about -0.01 per unit of risk. If you would invest 2,799 in Beijing Baolande Software on October 30, 2024 and sell it today you would lose (87.00) from holding Beijing Baolande Software or give up 3.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Baolande Software vs. Shanghai Rongtai Health
Performance |
| Timeline |
| Beijing Baolande Software |
| Shanghai Rongtai Health |
Beijing Baolande and Shanghai Rongtai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Baolande and Shanghai Rongtai
The main advantage of trading using opposite Beijing Baolande and Shanghai Rongtai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Baolande position performs unexpectedly, Shanghai Rongtai 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 Shanghai Rongtai will offset losses from the drop in Shanghai Rongtai's long position.| Beijing Baolande vs. Bank of China | Beijing Baolande vs. Kweichow Moutai Co | Beijing Baolande vs. PetroChina Co Ltd | Beijing Baolande vs. Bank of Communications |
| Shanghai Rongtai vs. China Everbright Bank | Shanghai Rongtai vs. Guosheng Financial Holding | Shanghai Rongtai vs. Shandong Rike Chemical | Shanghai Rongtai vs. Hua Xia Bank |
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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.
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