Correlation Between Shanghai Sanyou and Nanjing Putian
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By analyzing existing cross correlation between Shanghai Sanyou Medical and Nanjing Putian Telecommunications, you can compare the effects of market volatilities on Shanghai Sanyou and Nanjing Putian 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 Nanjing Putian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Sanyou and Nanjing Putian.
Diversification Opportunities for Shanghai Sanyou and Nanjing Putian
0.56 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Shanghai and Nanjing is 0.56. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Sanyou Medical and Nanjing Putian Telecommunicati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanjing Putian Telec 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 Nanjing Putian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanjing Putian Telec has no effect on the direction of Shanghai Sanyou i.e., Shanghai Sanyou and Nanjing Putian go up and down completely randomly.
Pair Corralation between Shanghai Sanyou and Nanjing Putian
Assuming the 90 days trading horizon Shanghai Sanyou Medical is expected to generate 0.66 times more return on investment than Nanjing Putian. However, Shanghai Sanyou Medical is 1.52 times less risky than Nanjing Putian. It trades about 0.09 of its potential returns per unit of risk. Nanjing Putian Telecommunications is currently generating about -0.04 per unit of risk. If you would invest 1,929 in Shanghai Sanyou Medical on October 23, 2024 and sell it today you would earn a total of 87.00 from holding Shanghai Sanyou Medical or generate 4.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 95.24% |
| Values | Daily Returns |
Shanghai Sanyou Medical vs. Nanjing Putian Telecommunicati
Performance |
| Timeline |
| Shanghai Sanyou Medical |
| Nanjing Putian Telec |
Shanghai Sanyou and Nanjing Putian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Sanyou and Nanjing Putian
The main advantage of trading using opposite Shanghai Sanyou and Nanjing Putian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Sanyou position performs unexpectedly, Nanjing Putian 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 Nanjing Putian will offset losses from the drop in Nanjing Putian's long position.| Shanghai Sanyou vs. Ming Yang Smart | Shanghai Sanyou vs. 159681 | Shanghai Sanyou vs. 159005 | Shanghai Sanyou vs. Loctek Ergonomic Technology |
| Nanjing Putian vs. Jiangsu GDK Biotechnology | Nanjing Putian vs. Maccura Biotechnology Co | Nanjing Putian vs. Zoje Resources Investment | Nanjing Putian vs. Sichuan Hebang 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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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