Correlation Between Bengang Steel and Zangge Holding
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By analyzing existing cross correlation between Bengang Steel Plates and Zangge Holding Co, you can compare the effects of market volatilities on Bengang Steel and Zangge Holding 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 Bengang Steel with a short position of Zangge Holding. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bengang Steel and Zangge Holding.
Diversification Opportunities for Bengang Steel and Zangge Holding
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Bengang and Zangge is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Bengang Steel Plates and Zangge Holding Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zangge Holding and Bengang Steel 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 Bengang Steel Plates are associated (or correlated) with Zangge Holding. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zangge Holding has no effect on the direction of Bengang Steel i.e., Bengang Steel and Zangge Holding go up and down completely randomly.
Pair Corralation between Bengang Steel and Zangge Holding
Assuming the 90 days trading horizon Bengang Steel is expected to generate 1.29 times less return on investment than Zangge Holding. In addition to that, Bengang Steel is 1.16 times more volatile than Zangge Holding Co. It trades about 0.02 of its total potential returns per unit of risk. Zangge Holding Co is currently generating about 0.03 per unit of volatility. If you would invest 2,335 in Zangge Holding Co on September 26, 2024 and sell it today you would earn a total of 440.00 from holding Zangge Holding Co or generate 18.84% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bengang Steel Plates vs. Zangge Holding Co
Performance |
| Timeline |
| Bengang Steel Plates |
| Zangge Holding |
Bengang Steel and Zangge Holding Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bengang Steel and Zangge Holding
The main advantage of trading using opposite Bengang Steel and Zangge Holding positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bengang Steel position performs unexpectedly, Zangge Holding 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 Zangge Holding will offset losses from the drop in Zangge Holding's long position.| Bengang Steel vs. Wanhua Chemical Group | Bengang Steel vs. Shandong Gold Mining | Bengang Steel vs. Rongsheng Petrochemical Co | Bengang Steel vs. Inner Mongolia BaoTou |
| Zangge Holding vs. Guangdong Shenglu Telecommunication | Zangge Holding vs. Gan Yuan Foods | Zangge Holding vs. Qingdao Foods Co | Zangge Holding vs. Fiberhome Telecommunication Technologies |
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 Portfolio Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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