Correlation Between China Securities and Inner Mongolia
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By analyzing existing cross correlation between China Securities 800 and Inner Mongolia Yuan, you can compare the effects of market volatilities on China Securities and Inner Mongolia 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 China Securities with a short position of Inner Mongolia. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Securities and Inner Mongolia.
Diversification Opportunities for China Securities and Inner Mongolia
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between China and Inner is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding China Securities 800 and Inner Mongolia Yuan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inner Mongolia Yuan and China Securities 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 China Securities 800 are associated (or correlated) with Inner Mongolia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inner Mongolia Yuan has no effect on the direction of China Securities i.e., China Securities and Inner Mongolia go up and down completely randomly.
Pair Corralation between China Securities and Inner Mongolia
Assuming the 90 days trading horizon China Securities 800 is expected to generate 0.68 times more return on investment than Inner Mongolia. However, China Securities 800 is 1.47 times less risky than Inner Mongolia. It trades about 0.06 of its potential returns per unit of risk. Inner Mongolia Yuan is currently generating about -0.07 per unit of risk. If you would invest 386,988 in China Securities 800 on September 3, 2024 and sell it today you would earn a total of 40,755 from holding China Securities 800 or generate 10.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Securities 800 vs. Inner Mongolia Yuan
Performance |
| Timeline |
China Securities and Inner Mongolia Volatility Contrast
Predicted Return Density |
| Returns |
China Securities 800
Pair trading matchups for China Securities
Inner Mongolia Yuan
Pair trading matchups for Inner Mongolia
Pair Trading with China Securities and Inner Mongolia
The main advantage of trading using opposite China Securities and Inner Mongolia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Securities position performs unexpectedly, Inner Mongolia 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 Inner Mongolia will offset losses from the drop in Inner Mongolia's long position.| China Securities vs. Guilin Seamild Foods | China Securities vs. HaiXin Foods Co | China Securities vs. Zhejiang Publishing Media | China Securities vs. Eastroc Beverage Group |
| Inner Mongolia vs. Chongqing Shunbo Aluminum | Inner Mongolia vs. Beijing Mainstreets Investment | Inner Mongolia vs. Zoje Resources Investment | Inner Mongolia vs. Rising Nonferrous Metals |
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 Bollinger Bands module to use Bollinger Bands indicator to analyze target price for a given investing horizon.
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