Correlation Between Advanced Technology and China Railway
Specify exactly 2 symbols:
By analyzing existing cross correlation between Advanced Technology Materials and China Railway Construction, you can compare the effects of market volatilities on Advanced Technology and China Railway 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 Advanced Technology with a short position of China Railway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Advanced Technology and China Railway.
Diversification Opportunities for Advanced Technology and China Railway
0.71 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Advanced and China is 0.71. Overlapping area represents the amount of risk that can be diversified away by holding Advanced Technology Materials and China Railway Construction in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Railway Constr and Advanced Technology 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 Advanced Technology Materials are associated (or correlated) with China Railway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Railway Constr has no effect on the direction of Advanced Technology i.e., Advanced Technology and China Railway go up and down completely randomly.
Pair Corralation between Advanced Technology and China Railway
Assuming the 90 days trading horizon Advanced Technology Materials is expected to generate 1.05 times more return on investment than China Railway. However, Advanced Technology is 1.05 times more volatile than China Railway Construction. It trades about 0.05 of its potential returns per unit of risk. China Railway Construction is currently generating about 0.03 per unit of risk. If you would invest 783.00 in Advanced Technology Materials on September 26, 2024 and sell it today you would earn a total of 361.00 from holding Advanced Technology Materials or generate 46.1% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Advanced Technology Materials vs. China Railway Construction
Performance |
| Timeline |
| Advanced Technology |
| China Railway Constr |
Advanced Technology and China Railway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Advanced Technology and China Railway
The main advantage of trading using opposite Advanced Technology and China Railway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Advanced Technology position performs unexpectedly, China Railway 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 China Railway will offset losses from the drop in China Railway's long position.| Advanced Technology vs. Zijin Mining Group | Advanced Technology vs. Wanhua Chemical Group | Advanced Technology vs. Baoshan Iron Steel | Advanced Technology vs. Shandong Gold Mining |
| China Railway vs. Cangzhou Mingzhu Plastic | China Railway vs. Chongqing Sulian Plastic | China Railway vs. GRIPM Advanced Materials | China Railway vs. Advanced Technology Materials |
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 Dashboard module to portfolio dashboard that provides centralized access to all your investments.
Other Complementary Tools
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Correlation Analysis Reduce portfolio risk simply by holding instruments which are not perfectly correlated | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios |