Correlation Between Shenyang Chemical and Hubei Yingtong
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By analyzing existing cross correlation between Shenyang Chemical Industry and Hubei Yingtong Telecommunication, you can compare the effects of market volatilities on Shenyang Chemical and Hubei Yingtong 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 Shenyang Chemical with a short position of Hubei Yingtong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shenyang Chemical and Hubei Yingtong.
Diversification Opportunities for Shenyang Chemical and Hubei Yingtong
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Shenyang and Hubei is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Shenyang Chemical Industry and Hubei Yingtong Telecommunicati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hubei Yingtong Telec and Shenyang Chemical 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 Shenyang Chemical Industry are associated (or correlated) with Hubei Yingtong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hubei Yingtong Telec has no effect on the direction of Shenyang Chemical i.e., Shenyang Chemical and Hubei Yingtong go up and down completely randomly.
Pair Corralation between Shenyang Chemical and Hubei Yingtong
Assuming the 90 days trading horizon Shenyang Chemical Industry is expected to under-perform the Hubei Yingtong. But the stock apears to be less risky and, when comparing its historical volatility, Shenyang Chemical Industry is 1.72 times less risky than Hubei Yingtong. The stock trades about -0.03 of its potential returns per unit of risk. The Hubei Yingtong Telecommunication is currently generating about 0.08 of returns per unit of risk over similar time horizon. If you would invest 1,295 in Hubei Yingtong Telecommunication on October 26, 2024 and sell it today you would earn a total of 245.00 from holding Hubei Yingtong Telecommunication or generate 18.92% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Weak |
Accuracy | 100.0% |
Values | Daily Returns |
Shenyang Chemical Industry vs. Hubei Yingtong Telecommunicati
Performance |
Timeline |
Shenyang Chemical |
Hubei Yingtong Telec |
Shenyang Chemical and Hubei Yingtong Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Shenyang Chemical and Hubei Yingtong
The main advantage of trading using opposite Shenyang Chemical and Hubei Yingtong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shenyang Chemical position performs unexpectedly, Hubei Yingtong 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 Hubei Yingtong will offset losses from the drop in Hubei Yingtong's long position.Shenyang Chemical vs. Zijin Mining Group | Shenyang Chemical vs. Wanhua Chemical Group | Shenyang Chemical vs. Baoshan Iron Steel | Shenyang Chemical vs. Shandong Gold Mining |
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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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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