Correlation Between Shenzhou International and PICC Property
Can any of the company-specific risk be diversified away by investing in both Shenzhou International and PICC Property 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 Shenzhou International and PICC Property into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shenzhou International Group and PICC Property and, you can compare the effects of market volatilities on Shenzhou International and PICC Property 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 Shenzhou International with a short position of PICC Property. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhou International and PICC Property.
Diversification Opportunities for Shenzhou International and PICC Property
0.07 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Shenzhou and PICC is 0.07. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhou International Group and PICC Property and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PICC Property and Shenzhou International 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 Shenzhou International Group are associated (or correlated) with PICC Property. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PICC Property has no effect on the direction of Shenzhou International i.e., Shenzhou International and PICC Property go up and down completely randomly.
Pair Corralation between Shenzhou International and PICC Property
Assuming the 90 days horizon Shenzhou International Group is expected to under-perform the PICC Property. In addition to that, Shenzhou International is 1.17 times more volatile than PICC Property and. It trades about -0.02 of its total potential returns per unit of risk. PICC Property and is currently generating about 0.08 per unit of volatility. If you would invest 2,010 in PICC Property and on November 9, 2024 and sell it today you would earn a total of 2,210 from holding PICC Property and or generate 109.95% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 84.99% |
| Values | Daily Returns |
Shenzhou International Group vs. PICC Property and
Performance |
| Timeline |
| Shenzhou International |
Risk-Adjusted Performance
Insignificant
Weak | Strong |
| PICC Property |
Shenzhou International and PICC Property Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhou International and PICC Property
The main advantage of trading using opposite Shenzhou International and PICC Property positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhou International position performs unexpectedly, PICC Property 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 PICC Property will offset losses from the drop in PICC Property's long position.| Shenzhou International vs. Unifi Inc | Shenzhou International vs. Culp Inc | Shenzhou International vs. ENN Energy Holdings | Shenzhou International vs. Anhui Conch Cement |
| PICC Property vs. Anhui Conch Cement | PICC Property vs. China Overseas Land | PICC Property vs. China Shenhua Energy | PICC Property vs. ENN Energy Holdings |
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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