Correlation Between Western Metal and Henan Shuanghui
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By analyzing existing cross correlation between Western Metal Materials and Henan Shuanghui Investment, you can compare the effects of market volatilities on Western Metal and Henan Shuanghui 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 Henan Shuanghui. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Metal and Henan Shuanghui.
Diversification Opportunities for Western Metal and Henan Shuanghui
0.24 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Western and Henan is 0.24. Overlapping area represents the amount of risk that can be diversified away by holding Western Metal Materials and Henan Shuanghui Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Henan Shuanghui Inve 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 Henan Shuanghui. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Henan Shuanghui Inve has no effect on the direction of Western Metal i.e., Western Metal and Henan Shuanghui go up and down completely randomly.
Pair Corralation between Western Metal and Henan Shuanghui
Assuming the 90 days trading horizon Western Metal Materials is expected to generate 1.83 times more return on investment than Henan Shuanghui. However, Western Metal is 1.83 times more volatile than Henan Shuanghui Investment. It trades about 0.07 of its potential returns per unit of risk. Henan Shuanghui Investment is currently generating about 0.06 per unit of risk. If you would invest 1,324 in Western Metal Materials on October 30, 2024 and sell it today you would earn a total of 376.00 from holding Western Metal Materials or generate 28.4% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Metal Materials vs. Henan Shuanghui Investment
Performance |
| Timeline |
| Western Metal Materials |
| Henan Shuanghui Inve |
Western Metal and Henan Shuanghui Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Metal and Henan Shuanghui
The main advantage of trading using opposite Western Metal and Henan Shuanghui positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Metal position performs unexpectedly, Henan Shuanghui 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 Henan Shuanghui will offset losses from the drop in Henan Shuanghui's long position.| Western Metal vs. Industrial Bank Co | Western Metal vs. Hangzhou Arcvideo Technology | Western Metal vs. Ningbo Tech Bank Co | Western Metal vs. Citic Guoan Wine |
| Henan Shuanghui vs. Kweichow Moutai Co | Henan Shuanghui vs. Contemporary Amperex Technology | Henan Shuanghui vs. G bits Network Technology | Henan Shuanghui vs. Beijing Roborock Technology |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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