Correlation Between Shanghai Rightongene and Qumei Furniture
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By analyzing existing cross correlation between Shanghai Rightongene Biotechnology and Qumei Furniture Group, you can compare the effects of market volatilities on Shanghai Rightongene and Qumei Furniture 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 Rightongene with a short position of Qumei Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Rightongene and Qumei Furniture.
Diversification Opportunities for Shanghai Rightongene and Qumei Furniture
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shanghai and Qumei is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Rightongene Biotechno and Qumei Furniture Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qumei Furniture Group and Shanghai Rightongene 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 Rightongene Biotechnology are associated (or correlated) with Qumei Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qumei Furniture Group has no effect on the direction of Shanghai Rightongene i.e., Shanghai Rightongene and Qumei Furniture go up and down completely randomly.
Pair Corralation between Shanghai Rightongene and Qumei Furniture
Assuming the 90 days trading horizon Shanghai Rightongene Biotechnology is expected to generate 1.14 times more return on investment than Qumei Furniture. However, Shanghai Rightongene is 1.14 times more volatile than Qumei Furniture Group. It trades about -0.04 of its potential returns per unit of risk. Qumei Furniture Group is currently generating about -0.06 per unit of risk. If you would invest 4,381 in Shanghai Rightongene Biotechnology on October 12, 2024 and sell it today you would lose (2,525) from holding Shanghai Rightongene Biotechnology or give up 57.64% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Rightongene Biotechno vs. Qumei Furniture Group
Performance |
| Timeline |
| Shanghai Rightongene |
| Qumei Furniture Group |
Shanghai Rightongene and Qumei Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Rightongene and Qumei Furniture
The main advantage of trading using opposite Shanghai Rightongene and Qumei Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Rightongene position performs unexpectedly, Qumei Furniture 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 Qumei Furniture will offset losses from the drop in Qumei Furniture's long position.| Shanghai Rightongene vs. Beijing Sanyuan Foods | Shanghai Rightongene vs. Ligao Foods CoLtd | Shanghai Rightongene vs. Guangzhou Seagull Kitchen | Shanghai Rightongene vs. Guilin Seamild Foods |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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