Correlation Between Jiaozuo Wanfang and Kuangda Technology
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By analyzing existing cross correlation between Jiaozuo Wanfang Aluminum and Kuangda Technology Group, you can compare the effects of market volatilities on Jiaozuo Wanfang and Kuangda Technology 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 Kuangda Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiaozuo Wanfang and Kuangda Technology.
Diversification Opportunities for Jiaozuo Wanfang and Kuangda Technology
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Jiaozuo and Kuangda is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Jiaozuo Wanfang Aluminum and Kuangda Technology Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kuangda Technology 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 Kuangda Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kuangda Technology has no effect on the direction of Jiaozuo Wanfang i.e., Jiaozuo Wanfang and Kuangda Technology go up and down completely randomly.
Pair Corralation between Jiaozuo Wanfang and Kuangda Technology
Assuming the 90 days trading horizon Jiaozuo Wanfang Aluminum is expected to generate 1.17 times more return on investment than Kuangda Technology. However, Jiaozuo Wanfang is 1.17 times more volatile than Kuangda Technology Group. It trades about 0.05 of its potential returns per unit of risk. Kuangda Technology Group is currently generating about 0.04 per unit of risk. If you would invest 543.00 in Jiaozuo Wanfang Aluminum on September 14, 2024 and sell it today you would earn a total of 172.00 from holding Jiaozuo Wanfang Aluminum or generate 31.68% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiaozuo Wanfang Aluminum vs. Kuangda Technology Group
Performance |
| Timeline |
| Jiaozuo Wanfang Aluminum |
| Kuangda Technology |
Jiaozuo Wanfang and Kuangda Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiaozuo Wanfang and Kuangda Technology
The main advantage of trading using opposite Jiaozuo Wanfang and Kuangda Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiaozuo Wanfang position performs unexpectedly, Kuangda Technology 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 Kuangda Technology will offset losses from the drop in Kuangda Technology'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 |
| Kuangda Technology vs. Nanjing Putian Telecommunications | Kuangda Technology vs. Tianjin Realty Development | Kuangda Technology vs. Kangyue Technology Co | Kuangda Technology vs. Shenzhen Hifuture Electric |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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