Correlation Between Shanghai Sanyou and Jiangxi Hengda
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By analyzing existing cross correlation between Shanghai Sanyou Medical and Jiangxi Hengda Hi Tech, you can compare the effects of market volatilities on Shanghai Sanyou and Jiangxi Hengda 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 Shanghai Sanyou with a short position of Jiangxi Hengda. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Sanyou and Jiangxi Hengda.
Diversification Opportunities for Shanghai Sanyou and Jiangxi Hengda
0.65 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shanghai and Jiangxi is 0.65. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Sanyou Medical and Jiangxi Hengda Hi Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangxi Hengda Hi and Shanghai Sanyou 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 Shanghai Sanyou Medical are associated (or correlated) with Jiangxi Hengda. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangxi Hengda Hi has no effect on the direction of Shanghai Sanyou i.e., Shanghai Sanyou and Jiangxi Hengda go up and down completely randomly.
Pair Corralation between Shanghai Sanyou and Jiangxi Hengda
Assuming the 90 days trading horizon Shanghai Sanyou Medical is expected to generate 0.67 times more return on investment than Jiangxi Hengda. However, Shanghai Sanyou Medical is 1.5 times less risky than Jiangxi Hengda. It trades about -0.23 of its potential returns per unit of risk. Jiangxi Hengda Hi Tech is currently generating about -0.17 per unit of risk. If you would invest 2,312 in Shanghai Sanyou Medical on October 11, 2024 and sell it today you would lose (352.00) from holding Shanghai Sanyou Medical or give up 15.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Sanyou Medical vs. Jiangxi Hengda Hi Tech
Performance |
| Timeline |
| Shanghai Sanyou Medical |
| Jiangxi Hengda Hi |
Shanghai Sanyou and Jiangxi Hengda Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Sanyou and Jiangxi Hengda
The main advantage of trading using opposite Shanghai Sanyou and Jiangxi Hengda positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Sanyou position performs unexpectedly, Jiangxi Hengda 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 Jiangxi Hengda will offset losses from the drop in Jiangxi Hengda's long position.| Shanghai Sanyou vs. Aba Chemicals Corp | Shanghai Sanyou vs. Anhui Huilong Agricultural | Shanghai Sanyou vs. Masterwork Machinery | Shanghai Sanyou vs. China Eastern Airlines |
| Jiangxi Hengda vs. Nanjing Vishee Medical | Jiangxi Hengda vs. Xiangyu Medical Co | Jiangxi Hengda vs. Shanghai Sanyou Medical | Jiangxi Hengda vs. Medprin Regenerative Medical |
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 Portfolio Dashboard module to portfolio dashboard that provides centralized access to all your investments.
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