Correlation Between Yunnan Aluminium and ADAMA
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By analyzing existing cross correlation between Yunnan Aluminium Co and ADAMA, you can compare the effects of market volatilities on Yunnan Aluminium and ADAMA 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 Yunnan Aluminium with a short position of ADAMA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yunnan Aluminium and ADAMA.
Diversification Opportunities for Yunnan Aluminium and ADAMA
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Yunnan and ADAMA is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Yunnan Aluminium Co and ADAMA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADAMA and Yunnan Aluminium 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 Yunnan Aluminium Co are associated (or correlated) with ADAMA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADAMA has no effect on the direction of Yunnan Aluminium i.e., Yunnan Aluminium and ADAMA go up and down completely randomly.
Pair Corralation between Yunnan Aluminium and ADAMA
Assuming the 90 days trading horizon Yunnan Aluminium Co is expected to under-perform the ADAMA. In addition to that, Yunnan Aluminium is 1.07 times more volatile than ADAMA. It trades about -0.21 of its total potential returns per unit of risk. ADAMA is currently generating about -0.06 per unit of volatility. If you would invest 613.00 in ADAMA on January 24, 2025 and sell it today you would lose (29.00) from holding ADAMA or give up 4.73% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yunnan Aluminium Co vs. ADAMA
Performance |
| Timeline |
| Yunnan Aluminium |
| ADAMA |
Yunnan Aluminium and ADAMA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yunnan Aluminium and ADAMA
The main advantage of trading using opposite Yunnan Aluminium and ADAMA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yunnan Aluminium position performs unexpectedly, ADAMA 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 ADAMA will offset losses from the drop in ADAMA's long position.| Yunnan Aluminium vs. Goke Microelectronics Co | Yunnan Aluminium vs. Shenzhen Clou Electronics | Yunnan Aluminium vs. CICC Fund Management | Yunnan Aluminium vs. JCHX Mining Management |
| ADAMA vs. Gome Telecom Equipment | ADAMA vs. Strait Innovation Internet | ADAMA vs. Sunwave Communications Co | ADAMA vs. Tongyu Communication |
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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