Correlation Between China Merchants and Henan Shuanghui
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By analyzing existing cross correlation between China Merchants Shekou and Henan Shuanghui Investment, you can compare the effects of market volatilities on China Merchants and Henan Shuanghui 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 China Merchants with a short position of Henan Shuanghui. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Merchants and Henan Shuanghui.
Diversification Opportunities for China Merchants and Henan Shuanghui
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Henan is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding China Merchants Shekou and Henan Shuanghui Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Henan Shuanghui Inve and China Merchants 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 China Merchants Shekou are associated (or correlated) with Henan Shuanghui. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Henan Shuanghui Inve has no effect on the direction of China Merchants i.e., China Merchants and Henan Shuanghui go up and down completely randomly.
Pair Corralation between China Merchants and Henan Shuanghui
Assuming the 90 days trading horizon China Merchants Shekou is expected to under-perform the Henan Shuanghui. In addition to that, China Merchants is 2.16 times more volatile than Henan Shuanghui Investment. It trades about -0.09 of its total potential returns per unit of risk. Henan Shuanghui Investment is currently generating about 0.03 per unit of volatility. If you would invest 2,526 in Henan Shuanghui Investment on September 12, 2024 and sell it today you would earn a total of 14.00 from holding Henan Shuanghui Investment or generate 0.55% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
China Merchants Shekou vs. Henan Shuanghui Investment
Performance |
Timeline |
China Merchants Shekou |
Henan Shuanghui Inve |
China Merchants and Henan Shuanghui Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with China Merchants and Henan Shuanghui
The main advantage of trading using opposite China Merchants and Henan Shuanghui positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Merchants position performs unexpectedly, Henan Shuanghui 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 Henan Shuanghui will offset losses from the drop in Henan Shuanghui's long position.China Merchants vs. Chongqing Brewery Co | China Merchants vs. Duzhe Publishing Media | China Merchants vs. Chinese Universe Publishing | China Merchants vs. Zhejiang Publishing Media |
Henan Shuanghui vs. China Petroleum Chemical | Henan Shuanghui vs. PetroChina Co Ltd | Henan Shuanghui vs. China State Construction | Henan Shuanghui vs. China Railway Group |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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