Correlation Between ShenZhen Yitoa and Gansu Huangtai

Can any of the company-specific risk be diversified away by investing in both ShenZhen Yitoa and Gansu Huangtai 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 Yitoa and Gansu Huangtai into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between ShenZhen Yitoa Intelligent and Gansu Huangtai Wine marketing, you can compare the effects of market volatilities on ShenZhen Yitoa and Gansu Huangtai 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 Yitoa with a short position of Gansu Huangtai. Check out your portfolio center. Please also check ongoing floating volatility patterns of ShenZhen Yitoa and Gansu Huangtai.

Diversification Opportunities for ShenZhen Yitoa and Gansu Huangtai

-0.34

Correlation Coefficient

ShenZhen Yitoa  Gansu Huangtai

Very good diversification

The 3 months correlation between ShenZhen and Gansu is -0.34. Overlapping area represents the amount of risk that can be diversified away by holding ShenZhen Yitoa Intelligent and Gansu Huangtai Wine marketing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gansu Huangtai Wine and ShenZhen Yitoa 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 Yitoa Intelligent are associated (or correlated) with Gansu Huangtai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gansu Huangtai Wine has no effect on the direction of ShenZhen Yitoa i.e., ShenZhen Yitoa and Gansu Huangtai go up and down completely randomly.

Pair Corralation between ShenZhen Yitoa and Gansu Huangtai

Assuming the 90 days trading horizon ShenZhen Yitoa Intelligent is expected to generate 1.1 times more return on investment than Gansu Huangtai. However, ShenZhen Yitoa is 1.1 times more volatile than Gansu Huangtai Wine marketing. It trades about 0.03 of its potential returns per unit of risk. Gansu Huangtai Wine marketing is currently generating about -0.06 per unit of risk. If you would invest  775.00  in ShenZhen Yitoa Intelligent on December 26, 2024 and sell it today you would earn a total of  11.00  from holding ShenZhen Yitoa Intelligent or generate 1.42% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Insignificant
Accuracy	100.0%
Values	Daily Returns

ShenZhen Yitoa Intelligent  vs.  Gansu Huangtai Wine marketing

ShenZhen Yitoa Intel

Risk-Adjusted Performance

Weak

Compared to the overall equity markets, risk-adjusted returns on investments in ShenZhen Yitoa Intelligent are ranked lower than 1 (%) of all global equities and portfolios over the last 90 days. Despite somewhat strong basic indicators, ShenZhen Yitoa is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Gansu Huangtai Wine

Risk-Adjusted Performance

Very Weak

Over the last 90 days Gansu Huangtai Wine marketing has generated negative risk-adjusted returns adding no value to investors with long positions. Despite latest weak performance, the Stock's basic indicators remain strong and the current disturbance on Wall Street may also be a sign of long term gains for the company investors.

Pair Trading with ShenZhen Yitoa and Gansu Huangtai

The main advantage of trading using opposite ShenZhen Yitoa and Gansu Huangtai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ShenZhen Yitoa position performs unexpectedly, Gansu Huangtai 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 Gansu Huangtai will offset losses from the drop in Gansu Huangtai's long position.

The idea behind ShenZhen Yitoa Intelligent and Gansu Huangtai Wine marketing pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..