Correlation Between Cangzhou Mingzhu and Gansu Jiu
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By analyzing existing cross correlation between Cangzhou Mingzhu Plastic and Gansu Jiu Steel, you can compare the effects of market volatilities on Cangzhou Mingzhu and Gansu Jiu 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 Cangzhou Mingzhu with a short position of Gansu Jiu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cangzhou Mingzhu and Gansu Jiu.
Diversification Opportunities for Cangzhou Mingzhu and Gansu Jiu
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Cangzhou and Gansu is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Cangzhou Mingzhu Plastic and Gansu Jiu Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gansu Jiu Steel and Cangzhou Mingzhu 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 Cangzhou Mingzhu Plastic are associated (or correlated) with Gansu Jiu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gansu Jiu Steel has no effect on the direction of Cangzhou Mingzhu i.e., Cangzhou Mingzhu and Gansu Jiu go up and down completely randomly.
Pair Corralation between Cangzhou Mingzhu and Gansu Jiu
Assuming the 90 days trading horizon Cangzhou Mingzhu Plastic is expected to generate 0.98 times more return on investment than Gansu Jiu. However, Cangzhou Mingzhu Plastic is 1.02 times less risky than Gansu Jiu. It trades about 0.22 of its potential returns per unit of risk. Gansu Jiu Steel is currently generating about -0.09 per unit of risk. If you would invest 354.00 in Cangzhou Mingzhu Plastic on September 3, 2024 and sell it today you would earn a total of 43.00 from holding Cangzhou Mingzhu Plastic or generate 12.15% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cangzhou Mingzhu Plastic vs. Gansu Jiu Steel
Performance |
| Timeline |
| Cangzhou Mingzhu Plastic |
| Gansu Jiu Steel |
Cangzhou Mingzhu and Gansu Jiu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cangzhou Mingzhu and Gansu Jiu
The main advantage of trading using opposite Cangzhou Mingzhu and Gansu Jiu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cangzhou Mingzhu position performs unexpectedly, Gansu Jiu 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 Gansu Jiu will offset losses from the drop in Gansu Jiu's long position.| Cangzhou Mingzhu vs. Gansu Jiu Steel | Cangzhou Mingzhu vs. Ming Yang Smart | Cangzhou Mingzhu vs. Aba Chemicals Corp | Cangzhou Mingzhu vs. Loctek Ergonomic Technology |
| Gansu Jiu vs. Cangzhou Mingzhu Plastic | Gansu Jiu vs. Eastern Communications Co | Gansu Jiu vs. Western Metal Materials | Gansu Jiu vs. Ningbo Tip Rubber |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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