Correlation Between Bengang Steel and Metro Investment
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By analyzing existing cross correlation between Bengang Steel Plates and Metro Investment Development, you can compare the effects of market volatilities on Bengang Steel and Metro Investment 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 Metro Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Bengang Steel and Metro Investment.
Diversification Opportunities for Bengang Steel and Metro Investment
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Bengang and Metro is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Bengang Steel Plates and Metro Investment Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metro Investment Dev 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 Metro Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metro Investment Dev has no effect on the direction of Bengang Steel i.e., Bengang Steel and Metro Investment go up and down completely randomly.
Pair Corralation between Bengang Steel and Metro Investment
Assuming the 90 days trading horizon Bengang Steel Plates is expected to under-perform the Metro Investment. But the stock apears to be less risky and, when comparing its historical volatility, Bengang Steel Plates is 1.35 times less risky than Metro Investment. The stock trades about 0.0 of its potential returns per unit of risk. The Metro Investment Development is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 508.00 in Metro Investment Development on September 4, 2024 and sell it today you would lose (41.00) from holding Metro Investment Development or give up 8.07% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Bengang Steel Plates vs. Metro Investment Development
Performance |
| Timeline |
| Bengang Steel Plates |
| Metro Investment Dev |
Bengang Steel and Metro Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Bengang Steel and Metro Investment
The main advantage of trading using opposite Bengang Steel and Metro Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Bengang Steel position performs unexpectedly, Metro Investment 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 Metro Investment will offset losses from the drop in Metro Investment's 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 |
| Metro Investment vs. Bengang Steel Plates | Metro Investment vs. Guangdong Liantai Environmental | Metro Investment vs. Shenzhen MYS Environmental | Metro Investment vs. Anhui Fuhuang Steel |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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