Correlation Between Shanghai Material and Blue Sail
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By analyzing existing cross correlation between Shanghai Material Trading and Blue Sail Medical, you can compare the effects of market volatilities on Shanghai Material and Blue Sail 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 Shanghai Material with a short position of Blue Sail. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shanghai Material and Blue Sail.
Diversification Opportunities for Shanghai Material and Blue Sail
0.61 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Shanghai and Blue is 0.61. Overlapping area represents the amount of risk that can be diversified away by holding Shanghai Material Trading and Blue Sail Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Blue Sail Medical and Shanghai Material 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 Shanghai Material Trading are associated (or correlated) with Blue Sail. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Blue Sail Medical has no effect on the direction of Shanghai Material i.e., Shanghai Material and Blue Sail go up and down completely randomly.
Pair Corralation between Shanghai Material and Blue Sail
Assuming the 90 days trading horizon Shanghai Material Trading is expected to generate 2.69 times more return on investment than Blue Sail. However, Shanghai Material is 2.69 times more volatile than Blue Sail Medical. It trades about -0.12 of its potential returns per unit of risk. Blue Sail Medical is currently generating about -0.46 per unit of risk. If you would invest 1,085 in Shanghai Material Trading on October 11, 2024 and sell it today you would lose (128.00) from holding Shanghai Material Trading or give up 11.8% of portfolio value over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Shanghai Material Trading vs. Blue Sail Medical
Performance |
Timeline |
Shanghai Material Trading |
Blue Sail Medical |
Shanghai Material and Blue Sail Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Shanghai Material and Blue Sail
The main advantage of trading using opposite Shanghai Material and Blue Sail positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shanghai Material position performs unexpectedly, Blue Sail 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 Blue Sail will offset losses from the drop in Blue Sail's long position.Shanghai Material vs. Songz Automobile Air | Shanghai Material vs. Zhejiang Qianjiang Motorcycle | Shanghai Material vs. Jiangsu Xinri E Vehicle | Shanghai Material vs. Dawning Information Industry |
Blue Sail vs. Shanghai Material Trading | Blue Sail vs. Hubei Geoway Investment | Blue Sail vs. China Sports Industry | Blue Sail vs. Vanfund Urban Investment |
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 Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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