Correlation Between Shanghai Rendu and China Vanke
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By analyzing existing cross correlation between Shanghai Rendu Biotechnology and China Vanke Co, you can compare the effects of market volatilities on Shanghai Rendu and China Vanke 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 Rendu with a short position of China Vanke. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Rendu and China Vanke.
Diversification Opportunities for Shanghai Rendu and China Vanke
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shanghai and China is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Rendu Biotechnology and China Vanke Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Vanke and Shanghai Rendu 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 Rendu Biotechnology are associated (or correlated) with China Vanke. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Vanke has no effect on the direction of Shanghai Rendu i.e., Shanghai Rendu and China Vanke go up and down completely randomly.
Pair Corralation between Shanghai Rendu and China Vanke
Assuming the 90 days trading horizon Shanghai Rendu Biotechnology is expected to generate 1.27 times more return on investment than China Vanke. However, Shanghai Rendu is 1.27 times more volatile than China Vanke Co. It trades about 0.01 of its potential returns per unit of risk. China Vanke Co is currently generating about -0.05 per unit of risk. If you would invest 4,636 in Shanghai Rendu Biotechnology on September 13, 2024 and sell it today you would lose (390.00) from holding Shanghai Rendu Biotechnology or give up 8.41% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Rendu Biotechnology vs. China Vanke Co
Performance |
| Timeline |
| Shanghai Rendu Biote |
| China Vanke |
Shanghai Rendu and China Vanke Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Rendu and China Vanke
The main advantage of trading using opposite Shanghai Rendu and China Vanke positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Rendu position performs unexpectedly, China Vanke 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 China Vanke will offset losses from the drop in China Vanke's long position.| Shanghai Rendu vs. Industrial and Commercial | Shanghai Rendu vs. China Construction Bank | Shanghai Rendu vs. Bank of China | Shanghai Rendu vs. Agricultural Bank of |
| China Vanke vs. Haima Automobile Group | China Vanke vs. Shanghai Rendu Biotechnology | China Vanke vs. Shenzhen Bioeasy Biotechnology | China Vanke vs. Anhui Jianghuai Automobile |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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