Correlation Between Shanghai CEO and Huitong Construction
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By analyzing existing cross correlation between Shanghai CEO Environmental and Huitong Construction Group, you can compare the effects of market volatilities on Shanghai CEO and Huitong Construction 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 CEO with a short position of Huitong Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai CEO and Huitong Construction.
Diversification Opportunities for Shanghai CEO and Huitong Construction
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Shanghai and Huitong is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai CEO Environmental and Huitong Construction Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Huitong Construction and Shanghai CEO 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 CEO Environmental are associated (or correlated) with Huitong Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Huitong Construction has no effect on the direction of Shanghai CEO i.e., Shanghai CEO and Huitong Construction go up and down completely randomly.
Pair Corralation between Shanghai CEO and Huitong Construction
Assuming the 90 days trading horizon Shanghai CEO Environmental is expected to generate 19.69 times more return on investment than Huitong Construction. However, Shanghai CEO is 19.69 times more volatile than Huitong Construction Group. It trades about 0.05 of its potential returns per unit of risk. Huitong Construction Group is currently generating about -0.01 per unit of risk. If you would invest 2,251 in Shanghai CEO Environmental on September 12, 2024 and sell it today you would lose (1,225) from holding Shanghai CEO Environmental or give up 54.42% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai CEO Environmental vs. Huitong Construction Group
Performance |
| Timeline |
| Shanghai CEO Environ |
| Huitong Construction |
Shanghai CEO and Huitong Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai CEO and Huitong Construction
The main advantage of trading using opposite Shanghai CEO and Huitong Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai CEO position performs unexpectedly, Huitong Construction 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 Huitong Construction will offset losses from the drop in Huitong Construction's long position.| Shanghai CEO vs. Agricultural Bank of | Shanghai CEO vs. Industrial and Commercial | Shanghai CEO vs. Bank of China | Shanghai CEO vs. PetroChina Co Ltd |
| Huitong Construction vs. Agricultural Bank of | Huitong Construction vs. Shanghai CEO Environmental | Huitong Construction vs. JCHX Mining Management | Huitong Construction vs. Jiangsu Financial Leasing |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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