Correlation Between Yunnan Aluminium and Boai NKY
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By analyzing existing cross correlation between Yunnan Aluminium Co and Boai NKY Pharmaceuticals, you can compare the effects of market volatilities on Yunnan Aluminium and Boai NKY 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 Boai NKY. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yunnan Aluminium and Boai NKY.
Diversification Opportunities for Yunnan Aluminium and Boai NKY
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Yunnan and Boai is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Yunnan Aluminium Co and Boai NKY Pharmaceuticals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Boai NKY Pharmaceuticals 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 Boai NKY. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Boai NKY Pharmaceuticals has no effect on the direction of Yunnan Aluminium i.e., Yunnan Aluminium and Boai NKY go up and down completely randomly.
Pair Corralation between Yunnan Aluminium and Boai NKY
Assuming the 90 days trading horizon Yunnan Aluminium Co is expected to generate 0.65 times more return on investment than Boai NKY. However, Yunnan Aluminium Co is 1.55 times less risky than Boai NKY. It trades about 0.05 of its potential returns per unit of risk. Boai NKY Pharmaceuticals is currently generating about 0.0 per unit of risk. If you would invest 1,121 in Yunnan Aluminium Co on September 4, 2024 and sell it today you would earn a total of 242.00 from holding Yunnan Aluminium Co or generate 21.59% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yunnan Aluminium Co vs. Boai NKY Pharmaceuticals
Performance |
| Timeline |
| Yunnan Aluminium |
| Boai NKY Pharmaceuticals |
Yunnan Aluminium and Boai NKY Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yunnan Aluminium and Boai NKY
The main advantage of trading using opposite Yunnan Aluminium and Boai NKY positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yunnan Aluminium position performs unexpectedly, Boai NKY 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 Boai NKY will offset losses from the drop in Boai NKY'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 |
| Boai NKY vs. Zijin Mining Group | Boai NKY vs. Wanhua Chemical Group | Boai NKY vs. Baoshan Iron Steel | Boai NKY 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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