Correlation Between Shenzhen International and Yuexiu Transport
Can any of the company-specific risk be diversified away by investing in both Shenzhen International and Yuexiu Transport 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 Shenzhen International and Yuexiu Transport into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Shenzhen International Holdings and Yuexiu Transport Infrastructure, you can compare the effects of market volatilities on Shenzhen International and Yuexiu Transport 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 Shenzhen International with a short position of Yuexiu Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenzhen International and Yuexiu Transport.
Diversification Opportunities for Shenzhen International and Yuexiu Transport
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Shenzhen and Yuexiu is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Shenzhen International Holding and Yuexiu Transport Infrastructur in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Yuexiu Transport Inf and Shenzhen 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 Shenzhen International Holdings are associated (or correlated) with Yuexiu Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Yuexiu Transport Inf has no effect on the direction of Shenzhen International i.e., Shenzhen International and Yuexiu Transport go up and down completely randomly.
Pair Corralation between Shenzhen International and Yuexiu Transport
If you would invest 45.00 in Yuexiu Transport Infrastructure on August 26, 2024 and sell it today you would earn a total of 13.00 from holding Yuexiu Transport Infrastructure or generate 28.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 60.63% |
| Values | Daily Returns |
Shenzhen International Holding vs. Yuexiu Transport Infrastructur
Performance |
| Timeline |
| Shenzhen International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Yuexiu Transport Inf |
Shenzhen International and Yuexiu Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shenzhen International and Yuexiu Transport
The main advantage of trading using opposite Shenzhen International and Yuexiu Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenzhen International position performs unexpectedly, Yuexiu Transport 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 Yuexiu Transport will offset losses from the drop in Yuexiu Transport's long position.| Shenzhen International vs. Zhejiang Expressway Co | Shenzhen International vs. Jiangsu Expressway Co | Shenzhen International vs. Jiangsu Expressway | Shenzhen International vs. Verra Mobility Corp |
| Yuexiu Transport vs. Verra Mobility Corp | Yuexiu Transport vs. HUMANA INC | Yuexiu Transport vs. Aquagold International | Yuexiu Transport vs. Barloworld Ltd ADR |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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