Correlation Between Sichuan Jinshi and Shanghai CEO
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By analyzing existing cross correlation between Sichuan Jinshi Technology and Shanghai CEO Environmental, you can compare the effects of market volatilities on Sichuan Jinshi and Shanghai CEO 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 Sichuan Jinshi with a short position of Shanghai CEO. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sichuan Jinshi and Shanghai CEO.
Diversification Opportunities for Sichuan Jinshi and Shanghai CEO
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sichuan and Shanghai is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Sichuan Jinshi Technology and Shanghai CEO Environmental in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai CEO Environ and Sichuan Jinshi 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 Sichuan Jinshi Technology are associated (or correlated) with Shanghai CEO. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai CEO Environ has no effect on the direction of Sichuan Jinshi i.e., Sichuan Jinshi and Shanghai CEO go up and down completely randomly.
Pair Corralation between Sichuan Jinshi and Shanghai CEO
Assuming the 90 days trading horizon Sichuan Jinshi Technology is expected to generate 1.15 times more return on investment than Shanghai CEO. However, Sichuan Jinshi is 1.15 times more volatile than Shanghai CEO Environmental. It trades about 0.1 of its potential returns per unit of risk. Shanghai CEO Environmental is currently generating about 0.09 per unit of risk. If you would invest 538.00 in Sichuan Jinshi Technology on September 15, 2024 and sell it today you would earn a total of 209.00 from holding Sichuan Jinshi Technology or generate 38.85% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Strong |
Accuracy | 100.0% |
Values | Daily Returns |
Sichuan Jinshi Technology vs. Shanghai CEO Environmental
Performance |
Timeline |
Sichuan Jinshi Technology |
Shanghai CEO Environ |
Sichuan Jinshi and Shanghai CEO Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Sichuan Jinshi and Shanghai CEO
The main advantage of trading using opposite Sichuan Jinshi and Shanghai CEO positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sichuan Jinshi position performs unexpectedly, Shanghai CEO 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 Shanghai CEO will offset losses from the drop in Shanghai CEO's long position.Sichuan Jinshi vs. Zijin Mining Group | Sichuan Jinshi vs. Wanhua Chemical Group | Sichuan Jinshi vs. Baoshan Iron Steel | Sichuan Jinshi 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 Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.
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