Correlation Between Henan Lantian and Shenzhen United
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By analyzing existing cross correlation between Henan Lantian Gas and Shenzhen United Winners, you can compare the effects of market volatilities on Henan Lantian and Shenzhen United 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 Henan Lantian with a short position of Shenzhen United. Check out your portfolio center. Please also check ongoing floating volatility patterns of Henan Lantian and Shenzhen United.
Diversification Opportunities for Henan Lantian and Shenzhen United
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Henan and Shenzhen is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Henan Lantian Gas and Shenzhen United Winners in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen United Winners and Henan Lantian 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 Henan Lantian Gas are associated (or correlated) with Shenzhen United. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen United Winners has no effect on the direction of Henan Lantian i.e., Henan Lantian and Shenzhen United go up and down completely randomly.
Pair Corralation between Henan Lantian and Shenzhen United
Assuming the 90 days trading horizon Henan Lantian Gas is expected to generate 0.55 times more return on investment than Shenzhen United. However, Henan Lantian Gas is 1.82 times less risky than Shenzhen United. It trades about 0.08 of its potential returns per unit of risk. Shenzhen United Winners is currently generating about -0.66 per unit of risk. If you would invest 1,117 in Henan Lantian Gas on October 5, 2024 and sell it today you would earn a total of 19.00 from holding Henan Lantian Gas or generate 1.7% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Weak |
Accuracy | 95.45% |
Values | Daily Returns |
Henan Lantian Gas vs. Shenzhen United Winners
Performance |
Timeline |
Henan Lantian Gas |
Shenzhen United Winners |
Henan Lantian and Shenzhen United Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Henan Lantian and Shenzhen United
The main advantage of trading using opposite Henan Lantian and Shenzhen United positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Henan Lantian position performs unexpectedly, Shenzhen United 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 Shenzhen United will offset losses from the drop in Shenzhen United's long position.Henan Lantian vs. Beijing Baolande Software | Henan Lantian vs. Innovative Medical Management | Henan Lantian vs. Zhangjiagang Freetrade Science | Henan Lantian vs. Servyou Software Group |
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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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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