Correlation Between Western Metal and City Development
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By analyzing existing cross correlation between Western Metal Materials and City Development Environment, you can compare the effects of market volatilities on Western Metal 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 Western Metal with a short position of City Development. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Metal and City Development.
Diversification Opportunities for Western Metal and City Development
0.43 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Western and City is 0.43. Overlapping area represents the amount of risk that can be diversified away by holding Western Metal Materials 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 Western Metal 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 Western Metal Materials 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 Western Metal i.e., Western Metal and City Development go up and down completely randomly.
Pair Corralation between Western Metal and City Development
Assuming the 90 days trading horizon Western Metal Materials is expected to generate 2.7 times more return on investment than City Development. However, Western Metal is 2.7 times more volatile than City Development Environment. It trades about 0.12 of its potential returns per unit of risk. City Development Environment is currently generating about -0.37 per unit of risk. If you would invest 1,585 in Western Metal Materials on October 12, 2024 and sell it today you would earn a total of 130.00 from holding Western Metal Materials or generate 8.2% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Metal Materials vs. City Development Environment
Performance |
| Timeline |
| Western Metal Materials |
| City Development Env |
Western Metal and City Development Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Metal and City Development
The main advantage of trading using opposite Western Metal and City Development positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Metal 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.| Western Metal vs. Xiandai Investment Co | Western Metal vs. Jiangsu Yueda Investment | Western Metal vs. Hunan Investment Group | Western Metal vs. Nanjing Vishee Medical |
| City Development vs. Western Metal Materials | City Development vs. Ningbo Tip Rubber | City Development vs. Chongqing Sulian Plastic | City Development vs. Fuda Alloy 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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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