Correlation Between Rongan Property and Dongjiang Environmental
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By analyzing existing cross correlation between Rongan Property Co and Dongjiang Environmental Co, you can compare the effects of market volatilities on Rongan Property and Dongjiang Environmental 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 Rongan Property with a short position of Dongjiang Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rongan Property and Dongjiang Environmental.
Diversification Opportunities for Rongan Property and Dongjiang Environmental
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Rongan and Dongjiang is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Rongan Property Co and Dongjiang Environmental Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongjiang Environmental and Rongan Property 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 Rongan Property Co are associated (or correlated) with Dongjiang Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongjiang Environmental has no effect on the direction of Rongan Property i.e., Rongan Property and Dongjiang Environmental go up and down completely randomly.
Pair Corralation between Rongan Property and Dongjiang Environmental
Assuming the 90 days trading horizon Rongan Property Co is expected to generate 1.01 times more return on investment than Dongjiang Environmental. However, Rongan Property is 1.01 times more volatile than Dongjiang Environmental Co. It trades about -0.18 of its potential returns per unit of risk. Dongjiang Environmental Co is currently generating about -0.3 per unit of risk. If you would invest 260.00 in Rongan Property Co on October 12, 2024 and sell it today you would lose (44.00) from holding Rongan Property Co or give up 16.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 97.73% |
| Values | Daily Returns |
Rongan Property Co vs. Dongjiang Environmental Co
Performance |
| Timeline |
| Rongan Property |
| Dongjiang Environmental |
Rongan Property and Dongjiang Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rongan Property and Dongjiang Environmental
The main advantage of trading using opposite Rongan Property and Dongjiang Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rongan Property position performs unexpectedly, Dongjiang Environmental 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 Dongjiang Environmental will offset losses from the drop in Dongjiang Environmental's long position.| Rongan Property vs. Allied Machinery Co | Rongan Property vs. Huasi Agricultural Development | Rongan Property vs. Bomesc Offshore Engineering | Rongan Property vs. Gifore Agricultural Machinery |
| Dongjiang Environmental vs. Shenzhen MYS Environmental | Dongjiang Environmental vs. AVIC Fund Management | Dongjiang Environmental vs. Rongan Property Co | Dongjiang Environmental vs. Haoxiangni Jujube Co |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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