Correlation Analysis Between Hang Seng and Shanghai

This module allows you to analyze existing cross correlation between Hang Seng and Shanghai. You can compare the effects of market volatilities on Hang Seng and Shanghai 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 Hang Seng with a short position of Shanghai. See also your portfolio center. Please also check ongoing floating volatility patterns of Hang Seng and Shanghai.
Horizon     30 Days    Login   to change

Hang Seng  vs.  Shanghai

 Performance (%) 

Pair Volatility

Given the investment horizon of 30 days, Hang Seng is expected to generate 2.14 times less return on investment than Shanghai. In addition to that, Hang Seng is 1.17 times more volatile than Shanghai. It trades about 0.05 of its total potential returns per unit of risk. Shanghai is currently generating about 0.12 per unit of volatility. If you would invest  257,008  in Shanghai on October 14, 2018 and sell it today you would earn a total of  8,480  from holding Shanghai or generate 3.3% return on investment over 30 days.

Pair Corralation between Hang Seng and Shanghai

Time Period1 Month [change]
ValuesDaily Returns


Hang Seng diversification synergy

Poor diversification

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

Comparative Volatility

 Predicted Return Density 

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