Correlation Between Bengang Steel and Tongling Nonferrous
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By analyzing existing cross correlation between Bengang Steel Plates and Tongling Nonferrous Metals, you can compare the effects of market volatilities on Bengang Steel and Tongling Nonferrous 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 Tongling Nonferrous. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bengang Steel and Tongling Nonferrous.
Diversification Opportunities for Bengang Steel and Tongling Nonferrous
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Bengang and Tongling is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Bengang Steel Plates and Tongling Nonferrous Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tongling Nonferrous 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 Tongling Nonferrous. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tongling Nonferrous has no effect on the direction of Bengang Steel i.e., Bengang Steel and Tongling Nonferrous go up and down completely randomly.
Pair Corralation between Bengang Steel and Tongling Nonferrous
Assuming the 90 days trading horizon Bengang Steel Plates is expected to generate 1.15 times more return on investment than Tongling Nonferrous. However, Bengang Steel is 1.15 times more volatile than Tongling Nonferrous Metals. It trades about 0.01 of its potential returns per unit of risk. Tongling Nonferrous Metals is currently generating about 0.01 per unit of risk. If you would invest 297.00 in Bengang Steel Plates on October 7, 2024 and sell it today you would earn a total of 9.00 from holding Bengang Steel Plates or generate 3.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bengang Steel Plates vs. Tongling Nonferrous Metals
Performance |
| Timeline |
| Bengang Steel Plates |
| Tongling Nonferrous |
Bengang Steel and Tongling Nonferrous Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bengang Steel and Tongling Nonferrous
The main advantage of trading using opposite Bengang Steel and Tongling Nonferrous positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bengang Steel position performs unexpectedly, Tongling Nonferrous 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 Tongling Nonferrous will offset losses from the drop in Tongling Nonferrous' long position.| Bengang Steel vs. Zijin Mining Group | Bengang Steel vs. Wanhua Chemical Group | Bengang Steel vs. Baoshan Iron Steel | Bengang Steel vs. Rongsheng Petrochemical Co |
| Tongling Nonferrous vs. Zijin Mining Group | Tongling Nonferrous vs. Wanhua Chemical Group | Tongling Nonferrous vs. Baoshan Iron Steel | Tongling Nonferrous vs. Rongsheng Petrochemical Co |
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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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