Correlation Between Yueyang Xingchang and City Development
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By analyzing existing cross correlation between Yueyang Xingchang Petro Chemical and City Development Environment, you can compare the effects of market volatilities on Yueyang Xingchang and City Development 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 Yueyang Xingchang with a short position of City Development. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yueyang Xingchang and City Development.
Diversification Opportunities for Yueyang Xingchang and City Development
0.82 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Yueyang and City is 0.82. Overlapping area represents the amount of risk that can be diversified away by holding Yueyang Xingchang Petro Chemic and City Development Environment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on City Development Env and Yueyang Xingchang 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 Yueyang Xingchang Petro Chemical are associated (or correlated) with City Development. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of City Development Env has no effect on the direction of Yueyang Xingchang i.e., Yueyang Xingchang and City Development go up and down completely randomly.
Pair Corralation between Yueyang Xingchang and City Development
Assuming the 90 days trading horizon Yueyang Xingchang Petro Chemical is expected to under-perform the City Development. In addition to that, Yueyang Xingchang is 1.27 times more volatile than City Development Environment. It trades about -0.03 of its total potential returns per unit of risk. City Development Environment is currently generating about 0.03 per unit of volatility. If you would invest 1,023 in City Development Environment on October 31, 2024 and sell it today you would earn a total of 260.00 from holding City Development Environment or generate 25.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yueyang Xingchang Petro Chemic vs. City Development Environment
Performance |
| Timeline |
| Yueyang Xingchang Petro |
| City Development Env |
Yueyang Xingchang and City Development Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yueyang Xingchang and City Development
The main advantage of trading using opposite Yueyang Xingchang and City Development positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yueyang Xingchang position performs unexpectedly, City Development 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 City Development will offset losses from the drop in City Development's long position.| Yueyang Xingchang vs. Grandblue Environment Co | Yueyang Xingchang vs. Guangdong Jingyi Metal | Yueyang Xingchang vs. Shenzhen MYS Environmental | Yueyang Xingchang vs. Anyang Iron Steel |
| City Development vs. Muyuan Foodstuff Co | City Development vs. Anji Foodstuff Co | City Development vs. Hainan Mining Co | City Development vs. Zhengzhou Coal Mining |
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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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