Correlation Between Jiaozuo Wanfang and Guangzhou Fangbang
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By analyzing existing cross correlation between Jiaozuo Wanfang Aluminum and Guangzhou Fangbang Electronics, you can compare the effects of market volatilities on Jiaozuo Wanfang and Guangzhou Fangbang 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 Guangzhou Fangbang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiaozuo Wanfang and Guangzhou Fangbang.
Diversification Opportunities for Jiaozuo Wanfang and Guangzhou Fangbang
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Jiaozuo and Guangzhou is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Jiaozuo Wanfang Aluminum and Guangzhou Fangbang Electronics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangzhou Fangbang 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 Guangzhou Fangbang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangzhou Fangbang has no effect on the direction of Jiaozuo Wanfang i.e., Jiaozuo Wanfang and Guangzhou Fangbang go up and down completely randomly.
Pair Corralation between Jiaozuo Wanfang and Guangzhou Fangbang
Assuming the 90 days trading horizon Jiaozuo Wanfang Aluminum is expected to generate 0.61 times more return on investment than Guangzhou Fangbang. However, Jiaozuo Wanfang Aluminum is 1.64 times less risky than Guangzhou Fangbang. It trades about 0.03 of its potential returns per unit of risk. Guangzhou Fangbang Electronics is currently generating about 0.0 per unit of risk. If you would invest 550.00 in Jiaozuo Wanfang Aluminum on October 16, 2024 and sell it today you would earn a total of 163.00 from holding Jiaozuo Wanfang Aluminum or generate 29.64% 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. Guangzhou Fangbang Electronics
Performance |
| Timeline |
| Jiaozuo Wanfang Aluminum |
| Guangzhou Fangbang |
Jiaozuo Wanfang and Guangzhou Fangbang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiaozuo Wanfang and Guangzhou Fangbang
The main advantage of trading using opposite Jiaozuo Wanfang and Guangzhou Fangbang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiaozuo Wanfang position performs unexpectedly, Guangzhou Fangbang 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 Guangzhou Fangbang will offset losses from the drop in Guangzhou Fangbang'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 |
| Guangzhou Fangbang vs. Universal Scientific Industrial | Guangzhou Fangbang vs. Jiaozuo Wanfang Aluminum | Guangzhou Fangbang vs. Porton Fine Chemicals | Guangzhou Fangbang vs. Shanghai Yanpu Metal |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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