Correlation Between Yunnan Aluminium and Cofco Biochemical
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By analyzing existing cross correlation between Yunnan Aluminium Co and Cofco Biochemical Anhui, you can compare the effects of market volatilities on Yunnan Aluminium and Cofco Biochemical 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 Cofco Biochemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yunnan Aluminium and Cofco Biochemical.
Diversification Opportunities for Yunnan Aluminium and Cofco Biochemical
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Yunnan and Cofco is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Yunnan Aluminium Co and Cofco Biochemical Anhui in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cofco Biochemical Anhui 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 Cofco Biochemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cofco Biochemical Anhui has no effect on the direction of Yunnan Aluminium i.e., Yunnan Aluminium and Cofco Biochemical go up and down completely randomly.
Pair Corralation between Yunnan Aluminium and Cofco Biochemical
Assuming the 90 days trading horizon Yunnan Aluminium Co is expected to under-perform the Cofco Biochemical. In addition to that, Yunnan Aluminium is 1.54 times more volatile than Cofco Biochemical Anhui. It trades about -0.17 of its total potential returns per unit of risk. Cofco Biochemical Anhui is currently generating about 0.16 per unit of volatility. If you would invest 573.00 in Cofco Biochemical Anhui on September 4, 2024 and sell it today you would earn a total of 32.00 from holding Cofco Biochemical Anhui or generate 5.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yunnan Aluminium Co vs. Cofco Biochemical Anhui
Performance |
| Timeline |
| Yunnan Aluminium |
| Cofco Biochemical Anhui |
Yunnan Aluminium and Cofco Biochemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yunnan Aluminium and Cofco Biochemical
The main advantage of trading using opposite Yunnan Aluminium and Cofco Biochemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yunnan Aluminium position performs unexpectedly, Cofco Biochemical 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 Cofco Biochemical will offset losses from the drop in Cofco Biochemical's long position.| Yunnan Aluminium vs. Zijin Mining Group | Yunnan Aluminium vs. Wanhua Chemical Group | Yunnan Aluminium vs. Baoshan Iron Steel | Yunnan Aluminium vs. Rongsheng Petrochemical Co |
| Cofco Biochemical vs. Zijin Mining Group | Cofco Biochemical vs. Wanhua Chemical Group | Cofco Biochemical vs. Baoshan Iron Steel | Cofco Biochemical 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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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