Correlation Between Inner Mongolia and Gansu Jiu
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By analyzing existing cross correlation between Inner Mongolia Yuan and Gansu Jiu Steel, you can compare the effects of market volatilities on Inner Mongolia and Gansu Jiu 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 Inner Mongolia with a short position of Gansu Jiu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inner Mongolia and Gansu Jiu.
Diversification Opportunities for Inner Mongolia and Gansu Jiu
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Inner and Gansu is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Inner Mongolia Yuan and Gansu Jiu Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gansu Jiu Steel and Inner Mongolia 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 Inner Mongolia Yuan are associated (or correlated) with Gansu Jiu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gansu Jiu Steel has no effect on the direction of Inner Mongolia i.e., Inner Mongolia and Gansu Jiu go up and down completely randomly.
Pair Corralation between Inner Mongolia and Gansu Jiu
Assuming the 90 days trading horizon Inner Mongolia is expected to generate 9.78 times less return on investment than Gansu Jiu. But when comparing it to its historical volatility, Inner Mongolia Yuan is 1.3 times less risky than Gansu Jiu. It trades about 0.02 of its potential returns per unit of risk. Gansu Jiu Steel is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 119.00 in Gansu Jiu Steel on September 2, 2024 and sell it today you would earn a total of 47.00 from holding Gansu Jiu Steel or generate 39.5% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inner Mongolia Yuan vs. Gansu Jiu Steel
Performance |
| Timeline |
| Inner Mongolia Yuan |
| Gansu Jiu Steel |
Inner Mongolia and Gansu Jiu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inner Mongolia and Gansu Jiu
The main advantage of trading using opposite Inner Mongolia and Gansu Jiu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inner Mongolia position performs unexpectedly, Gansu Jiu 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 Gansu Jiu will offset losses from the drop in Gansu Jiu's long position.| Inner Mongolia vs. Jinhe Biotechnology Co | Inner Mongolia vs. Lootom Telcovideo Network | Inner Mongolia vs. Minmetals Capital Co | Inner Mongolia vs. Shenzhen Topway Video |
| Gansu Jiu vs. Western Metal Materials | Gansu Jiu vs. Chengtun Mining Group | Gansu Jiu vs. Uroica Mining Safety | Gansu Jiu vs. Beijing HuaYuanYiTong Thermal |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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