Correlation Between Tongling Nonferrous and Longjian Road
Specify exactly 2 symbols:
By analyzing existing cross correlation between Tongling Nonferrous Metals and Longjian Road Bridge, you can compare the effects of market volatilities on Tongling Nonferrous and Longjian Road 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 Tongling Nonferrous with a short position of Longjian Road. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tongling Nonferrous and Longjian Road.
Diversification Opportunities for Tongling Nonferrous and Longjian Road
0.55 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Tongling and Longjian is 0.55. Overlapping area represents the amount of risk that can be diversified away by holding Tongling Nonferrous Metals and Longjian Road Bridge in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Longjian Road Bridge and Tongling Nonferrous 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 Tongling Nonferrous Metals are associated (or correlated) with Longjian Road. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Longjian Road Bridge has no effect on the direction of Tongling Nonferrous i.e., Tongling Nonferrous and Longjian Road go up and down completely randomly.
Pair Corralation between Tongling Nonferrous and Longjian Road
Assuming the 90 days trading horizon Tongling Nonferrous Metals is expected to generate 0.75 times more return on investment than Longjian Road. However, Tongling Nonferrous Metals is 1.34 times less risky than Longjian Road. It trades about 0.02 of its potential returns per unit of risk. Longjian Road Bridge is currently generating about 0.0 per unit of risk. If you would invest 302.00 in Tongling Nonferrous Metals on November 8, 2024 and sell it today you would earn a total of 31.00 from holding Tongling Nonferrous Metals or generate 10.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tongling Nonferrous Metals vs. Longjian Road Bridge
Performance |
| Timeline |
| Tongling Nonferrous |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Longjian Road Bridge |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Tongling Nonferrous and Longjian Road Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tongling Nonferrous and Longjian Road
The main advantage of trading using opposite Tongling Nonferrous and Longjian Road positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tongling Nonferrous position performs unexpectedly, Longjian Road 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 Longjian Road will offset losses from the drop in Longjian Road's long position.The idea behind Tongling Nonferrous Metals and Longjian Road Bridge pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Other Complementary Tools
| Financial Widgets Easily integrated Macroaxis content with over 30 different plug-and-play financial widgets | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Bond Analysis Evaluate and analyze corporate bonds as a potential investment for your portfolios. | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account | |
| Performance Analysis Check effects of mean-variance optimization against your current asset allocation |