Correlation Between Jiaozuo Wanfang and China Merchants
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By analyzing existing cross correlation between Jiaozuo Wanfang Aluminum and China Merchants Shekou, you can compare the effects of market volatilities on Jiaozuo Wanfang and China Merchants 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 China Merchants. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiaozuo Wanfang and China Merchants.
Diversification Opportunities for Jiaozuo Wanfang and China Merchants
0.58 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jiaozuo and China is 0.58. Overlapping area represents the amount of risk that can be diversified away by holding Jiaozuo Wanfang Aluminum and China Merchants Shekou in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Merchants Shekou 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 China Merchants. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Merchants Shekou has no effect on the direction of Jiaozuo Wanfang i.e., Jiaozuo Wanfang and China Merchants go up and down completely randomly.
Pair Corralation between Jiaozuo Wanfang and China Merchants
Assuming the 90 days trading horizon Jiaozuo Wanfang Aluminum is expected to generate 1.07 times more return on investment than China Merchants. However, Jiaozuo Wanfang is 1.07 times more volatile than China Merchants Shekou. It trades about 0.05 of its potential returns per unit of risk. China Merchants Shekou is currently generating about -0.01 per unit of risk. If you would invest 492.00 in Jiaozuo Wanfang Aluminum on October 16, 2024 and sell it today you would earn a total of 232.00 from holding Jiaozuo Wanfang Aluminum or generate 47.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiaozuo Wanfang Aluminum vs. China Merchants Shekou
Performance |
| Timeline |
| Jiaozuo Wanfang Aluminum |
| China Merchants Shekou |
Jiaozuo Wanfang and China Merchants Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiaozuo Wanfang and China Merchants
The main advantage of trading using opposite Jiaozuo Wanfang and China Merchants positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiaozuo Wanfang position performs unexpectedly, China Merchants 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 China Merchants will offset losses from the drop in China Merchants' long position.| Jiaozuo Wanfang vs. Hunan TV Broadcast | Jiaozuo Wanfang vs. Vats Liquor Chain | Jiaozuo Wanfang vs. V V Food | Jiaozuo Wanfang vs. Hubeiyichang Transportation Group |
| China Merchants vs. Aluminum Corp of | China Merchants vs. Shuhua Sports Co | China Merchants vs. Anhui Transport Consulting | China Merchants vs. Jiaozuo Wanfang Aluminum |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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