Correlation Between Shanghai OPM and Shenzhen Inovance
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By analyzing existing cross correlation between Shanghai OPM Biosciences and Shenzhen Inovance Tech, you can compare the effects of market volatilities on Shanghai OPM and Shenzhen Inovance 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 OPM with a short position of Shenzhen Inovance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai OPM and Shenzhen Inovance.
Diversification Opportunities for Shanghai OPM and Shenzhen Inovance
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shanghai and Shenzhen is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai OPM Biosciences and Shenzhen Inovance Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Inovance Tech and Shanghai OPM 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 OPM Biosciences are associated (or correlated) with Shenzhen Inovance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Inovance Tech has no effect on the direction of Shanghai OPM i.e., Shanghai OPM and Shenzhen Inovance go up and down completely randomly.
Pair Corralation between Shanghai OPM and Shenzhen Inovance
Assuming the 90 days trading horizon Shanghai OPM Biosciences is expected to generate 1.81 times more return on investment than Shenzhen Inovance. However, Shanghai OPM is 1.81 times more volatile than Shenzhen Inovance Tech. It trades about 0.07 of its potential returns per unit of risk. Shenzhen Inovance Tech is currently generating about 0.05 per unit of risk. If you would invest 3,230 in Shanghai OPM Biosciences on October 15, 2024 and sell it today you would earn a total of 479.00 from holding Shanghai OPM Biosciences or generate 14.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai OPM Biosciences vs. Shenzhen Inovance Tech
Performance |
| Timeline |
| Shanghai OPM Biosciences |
| Shenzhen Inovance Tech |
Shanghai OPM and Shenzhen Inovance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai OPM and Shenzhen Inovance
The main advantage of trading using opposite Shanghai OPM and Shenzhen Inovance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai OPM position performs unexpectedly, Shenzhen Inovance 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 Shenzhen Inovance will offset losses from the drop in Shenzhen Inovance's long position.| Shanghai OPM vs. Citic Offshore Helicopter | Shanghai OPM vs. TianJin 712 Communication | Shanghai OPM vs. Fiberhome Telecommunication Technologies | Shanghai OPM vs. Tongyu Communication |
| Shenzhen Inovance vs. Rising Nonferrous Metals | Shenzhen Inovance vs. Tibet Huayu Mining | Shenzhen Inovance vs. Beijing Jiaman Dress | Shenzhen Inovance vs. Anhui Jinhe Industrial |
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 Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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