Correlation Between Jiaozuo Wanfang and Ningxia Younglight
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By analyzing existing cross correlation between Jiaozuo Wanfang Aluminum and Ningxia Younglight Chemicals, you can compare the effects of market volatilities on Jiaozuo Wanfang and Ningxia Younglight 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 Jiaozuo Wanfang with a short position of Ningxia Younglight. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiaozuo Wanfang and Ningxia Younglight.
Diversification Opportunities for Jiaozuo Wanfang and Ningxia Younglight
0.36 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Jiaozuo and Ningxia is 0.36. Overlapping area represents the amount of risk that can be diversified away by holding Jiaozuo Wanfang Aluminum and Ningxia Younglight Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningxia Younglight and Jiaozuo Wanfang 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 Jiaozuo Wanfang Aluminum are associated (or correlated) with Ningxia Younglight. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningxia Younglight has no effect on the direction of Jiaozuo Wanfang i.e., Jiaozuo Wanfang and Ningxia Younglight go up and down completely randomly.
Pair Corralation between Jiaozuo Wanfang and Ningxia Younglight
Assuming the 90 days trading horizon Jiaozuo Wanfang Aluminum is expected to generate 1.04 times more return on investment than Ningxia Younglight. However, Jiaozuo Wanfang is 1.04 times more volatile than Ningxia Younglight Chemicals. It trades about 0.09 of its potential returns per unit of risk. Ningxia Younglight Chemicals is currently generating about 0.05 per unit of risk. If you would invest 697.00 in Jiaozuo Wanfang Aluminum on November 5, 2024 and sell it today you would earn a total of 19.00 from holding Jiaozuo Wanfang Aluminum or generate 2.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiaozuo Wanfang Aluminum vs. Ningxia Younglight Chemicals
Performance |
| Timeline |
| Jiaozuo Wanfang Aluminum |
| Ningxia Younglight |
Jiaozuo Wanfang and Ningxia Younglight Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiaozuo Wanfang and Ningxia Younglight
The main advantage of trading using opposite Jiaozuo Wanfang and Ningxia Younglight positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiaozuo Wanfang position performs unexpectedly, Ningxia Younglight 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 Ningxia Younglight will offset losses from the drop in Ningxia Younglight's long position.| Jiaozuo Wanfang vs. Zijin Mining Group | Jiaozuo Wanfang vs. Wanhua Chemical Group | Jiaozuo Wanfang vs. Baoshan Iron Steel | Jiaozuo Wanfang vs. Shandong Gold Mining |
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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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