Correlation Between Shenguan Holdings and A2 Milk
Can any of the company-specific risk be diversified away by investing in both Shenguan Holdings and A2 Milk at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Shenguan Holdings and A2 Milk into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shenguan Holdings Group and The A2 Milk, you can compare the effects of market volatilities on Shenguan Holdings and A2 Milk 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 Shenguan Holdings with a short position of A2 Milk. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenguan Holdings and A2 Milk.
Diversification Opportunities for Shenguan Holdings and A2 Milk
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Shenguan and ACOPY is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Shenguan Holdings Group and The A2 Milk in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on A2 Milk and Shenguan Holdings 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 Shenguan Holdings Group are associated (or correlated) with A2 Milk. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of A2 Milk has no effect on the direction of Shenguan Holdings i.e., Shenguan Holdings and A2 Milk go up and down completely randomly.
Pair Corralation between Shenguan Holdings and A2 Milk
Assuming the 90 days horizon Shenguan Holdings Group is expected to generate 0.16 times more return on investment than A2 Milk. However, Shenguan Holdings Group is 6.35 times less risky than A2 Milk. It trades about 0.09 of its potential returns per unit of risk. The A2 Milk is currently generating about -0.03 per unit of risk. If you would invest 82.00 in Shenguan Holdings Group on September 2, 2024 and sell it today you would earn a total of 5.00 from holding Shenguan Holdings Group or generate 6.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shenguan Holdings Group vs. The A2 Milk
Performance |
| Timeline |
| Shenguan Holdings |
| A2 Milk |
Shenguan Holdings and A2 Milk Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenguan Holdings and A2 Milk
The main advantage of trading using opposite Shenguan Holdings and A2 Milk positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenguan Holdings position performs unexpectedly, A2 Milk 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 A2 Milk will offset losses from the drop in A2 Milk's long position.| Shenguan Holdings vs. The A2 Milk | Shenguan Holdings vs. Artisan Consumer Goods | Shenguan Holdings vs. General Mills |
| A2 Milk vs. Artisan Consumer Goods | A2 Milk vs. Altavoz Entertainment | A2 Milk vs. Avi Ltd ADR | A2 Milk vs. Aryzta AG PK |
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 ETFs module to find actively traded Exchange Traded Funds (ETF) from around the world.
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