Correlation Between Shanghai Newtouch and Zhejiang Yongjin
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By analyzing existing cross correlation between Shanghai Newtouch Software and Zhejiang Yongjin Metal, you can compare the effects of market volatilities on Shanghai Newtouch and Zhejiang Yongjin 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 Newtouch with a short position of Zhejiang Yongjin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Newtouch and Zhejiang Yongjin.
Diversification Opportunities for Shanghai Newtouch and Zhejiang Yongjin
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Shanghai and Zhejiang is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Newtouch Software and Zhejiang Yongjin Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Yongjin Metal and Shanghai Newtouch 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 Newtouch Software are associated (or correlated) with Zhejiang Yongjin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Yongjin Metal has no effect on the direction of Shanghai Newtouch i.e., Shanghai Newtouch and Zhejiang Yongjin go up and down completely randomly.
Pair Corralation between Shanghai Newtouch and Zhejiang Yongjin
Assuming the 90 days trading horizon Shanghai Newtouch Software is expected to under-perform the Zhejiang Yongjin. In addition to that, Shanghai Newtouch is 2.01 times more volatile than Zhejiang Yongjin Metal. It trades about -0.02 of its total potential returns per unit of risk. Zhejiang Yongjin Metal is currently generating about 0.0 per unit of volatility. If you would invest 1,940 in Zhejiang Yongjin Metal on October 16, 2024 and sell it today you would lose (133.00) from holding Zhejiang Yongjin Metal or give up 6.86% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shanghai Newtouch Software vs. Zhejiang Yongjin Metal
Performance |
| Timeline |
| Shanghai Newtouch |
| Zhejiang Yongjin Metal |
Shanghai Newtouch and Zhejiang Yongjin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shanghai Newtouch and Zhejiang Yongjin
The main advantage of trading using opposite Shanghai Newtouch and Zhejiang Yongjin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Newtouch position performs unexpectedly, Zhejiang Yongjin 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 Zhejiang Yongjin will offset losses from the drop in Zhejiang Yongjin's long position.| Shanghai Newtouch vs. China World Trade | Shanghai Newtouch vs. Anyang Iron Steel | Shanghai Newtouch vs. Grandblue Environment Co | Shanghai Newtouch vs. Zhengzhou Qianweiyangchu Food |
| Zhejiang Yongjin vs. Shenzhen Clou Electronics | Zhejiang Yongjin vs. Huasi Agricultural Development | Zhejiang Yongjin vs. TongFu Microelectronics Co | Zhejiang Yongjin vs. Epoxy Base Electronic |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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