Correlation Between Western Metal and Inspur Software
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By analyzing existing cross correlation between Western Metal Materials and Inspur Software Co, you can compare the effects of market volatilities on Western Metal and Inspur Software 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 Inspur Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Metal and Inspur Software.
Diversification Opportunities for Western Metal and Inspur Software
-0.26 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Western and Inspur is -0.26. Overlapping area represents the amount of risk that can be diversified away by holding Western Metal Materials and Inspur Software Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inspur Software 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 Inspur Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inspur Software has no effect on the direction of Western Metal i.e., Western Metal and Inspur Software go up and down completely randomly.
Pair Corralation between Western Metal and Inspur Software
Assuming the 90 days trading horizon Western Metal Materials is expected to generate 1.15 times more return on investment than Inspur Software. However, Western Metal is 1.15 times more volatile than Inspur Software Co. It trades about 0.01 of its potential returns per unit of risk. Inspur Software Co is currently generating about -0.05 per unit of risk. If you would invest 1,719 in Western Metal Materials on November 6, 2024 and sell it today you would lose (19.00) from holding Western Metal Materials or give up 1.11% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Metal Materials vs. Inspur Software Co
Performance |
| Timeline |
| Western Metal Materials |
| Inspur Software |
Western Metal and Inspur Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Metal and Inspur Software
The main advantage of trading using opposite Western Metal and Inspur Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Metal position performs unexpectedly, Inspur Software 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 Inspur Software will offset losses from the drop in Inspur Software's long position.| Western Metal vs. Zijin Mining Group | Western Metal vs. Wanhua Chemical Group | Western Metal vs. Baoshan Iron Steel | Western Metal vs. Shandong Gold Mining |
| Inspur Software vs. Jiangsu Jinling Sports | Inspur Software vs. Industrial Bank Co | Inspur Software vs. Guosheng Financial Holding | Inspur Software vs. Lecron Energy Saving |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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