Correlation Between Shandong Sanyuan and Beijing Kaiwen
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By analyzing existing cross correlation between Shandong Sanyuan Biotechnology and Beijing Kaiwen Education, you can compare the effects of market volatilities on Shandong Sanyuan and Beijing Kaiwen 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 Shandong Sanyuan with a short position of Beijing Kaiwen. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Sanyuan and Beijing Kaiwen.
Diversification Opportunities for Shandong Sanyuan and Beijing Kaiwen
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shandong and Beijing is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Sanyuan Biotechnology and Beijing Kaiwen Education in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Kaiwen Education and Shandong Sanyuan 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 Shandong Sanyuan Biotechnology are associated (or correlated) with Beijing Kaiwen. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Kaiwen Education has no effect on the direction of Shandong Sanyuan i.e., Shandong Sanyuan and Beijing Kaiwen go up and down completely randomly.
Pair Corralation between Shandong Sanyuan and Beijing Kaiwen
Assuming the 90 days trading horizon Shandong Sanyuan Biotechnology is expected to generate 0.76 times more return on investment than Beijing Kaiwen. However, Shandong Sanyuan Biotechnology is 1.32 times less risky than Beijing Kaiwen. It trades about 0.06 of its potential returns per unit of risk. Beijing Kaiwen Education is currently generating about -0.1 per unit of risk. If you would invest 2,584 in Shandong Sanyuan Biotechnology on December 10, 2024 and sell it today you would earn a total of 41.00 from holding Shandong Sanyuan Biotechnology or generate 1.59% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Shandong Sanyuan Biotechnology vs. Beijing Kaiwen Education
Performance |
Timeline |
Shandong Sanyuan Bio |
Beijing Kaiwen Education |
Shandong Sanyuan and Beijing Kaiwen Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Shandong Sanyuan and Beijing Kaiwen
The main advantage of trading using opposite Shandong Sanyuan and Beijing Kaiwen positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Sanyuan position performs unexpectedly, Beijing Kaiwen 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 Beijing Kaiwen will offset losses from the drop in Beijing Kaiwen's long position.Shandong Sanyuan vs. Yonghui Superstores Co | Shandong Sanyuan vs. iSoftStone Information Technology | Shandong Sanyuan vs. HanS Laser Tech | Shandong Sanyuan vs. Jiang Su New |
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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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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