Correlation Between Western Metal and Nanjing Putian
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By analyzing existing cross correlation between Western Metal Materials and Nanjing Putian Telecommunications, you can compare the effects of market volatilities on Western Metal and Nanjing Putian 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 Nanjing Putian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Metal and Nanjing Putian.
Diversification Opportunities for Western Metal and Nanjing Putian
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Western and Nanjing is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Western Metal Materials and Nanjing Putian Telecommunicati in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nanjing Putian Telec 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 Nanjing Putian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nanjing Putian Telec has no effect on the direction of Western Metal i.e., Western Metal and Nanjing Putian go up and down completely randomly.
Pair Corralation between Western Metal and Nanjing Putian
Assuming the 90 days trading horizon Western Metal Materials is expected to generate 0.6 times more return on investment than Nanjing Putian. However, Western Metal Materials is 1.67 times less risky than Nanjing Putian. It trades about 0.13 of its potential returns per unit of risk. Nanjing Putian Telecommunications is currently generating about -0.18 per unit of risk. If you would invest 1,643 in Western Metal Materials on September 28, 2024 and sell it today you would earn a total of 113.00 from holding Western Metal Materials or generate 6.88% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Metal Materials vs. Nanjing Putian Telecommunicati
Performance |
| Timeline |
| Western Metal Materials |
| Nanjing Putian Telec |
Western Metal and Nanjing Putian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Metal and Nanjing Putian
The main advantage of trading using opposite Western Metal and Nanjing Putian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Metal position performs unexpectedly, Nanjing Putian 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 Nanjing Putian will offset losses from the drop in Nanjing Putian's long position.| Western Metal vs. Guangzhou Tinci Materials | Western Metal vs. King Strong New Material | Western Metal vs. Circuit Fabology Microelectronics | Western Metal vs. Hangzhou Gaoxin Rubber |
| Nanjing Putian vs. Tianshui Huatian Technology | Nanjing Putian vs. Eastroc Beverage Group | Nanjing Putian vs. Sinofibers Technology Co | Nanjing Putian vs. Kuang Chi Technologies |
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 ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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