Correlation Between Western Metal and Ye Chiu
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By analyzing existing cross correlation between Western Metal Materials and Ye Chiu Metal, you can compare the effects of market volatilities on Western Metal and Ye Chiu 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 Ye Chiu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Metal and Ye Chiu.
Diversification Opportunities for Western Metal and Ye Chiu
0.96 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Western and 601388 is 0.96. Overlapping area represents the amount of risk that can be diversified away by holding Western Metal Materials and Ye Chiu Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ye Chiu Metal 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 Ye Chiu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ye Chiu Metal has no effect on the direction of Western Metal i.e., Western Metal and Ye Chiu go up and down completely randomly.
Pair Corralation between Western Metal and Ye Chiu
Assuming the 90 days trading horizon Western Metal Materials is expected to generate 1.01 times more return on investment than Ye Chiu. However, Western Metal is 1.01 times more volatile than Ye Chiu Metal. It trades about 0.02 of its potential returns per unit of risk. Ye Chiu Metal is currently generating about -0.01 per unit of risk. If you would invest 1,470 in Western Metal Materials on August 29, 2024 and sell it today you would earn a total of 173.00 from holding Western Metal Materials or generate 11.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Metal Materials vs. Ye Chiu Metal
Performance |
| Timeline |
| Western Metal Materials |
| Ye Chiu Metal |
Western Metal and Ye Chiu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Metal and Ye Chiu
The main advantage of trading using opposite Western Metal and Ye Chiu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Metal position performs unexpectedly, Ye Chiu 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 Ye Chiu will offset losses from the drop in Ye Chiu's long position.| Western Metal vs. Shandong Gold Mining | Western Metal vs. Rongsheng Petrochemical Co | Western Metal vs. Inner Mongolia BaoTou | Western Metal vs. Jiangxi Ganfeng Lithium |
| Ye Chiu vs. Shandong Gold Mining | Ye Chiu vs. Rongsheng Petrochemical Co | Ye Chiu vs. Inner Mongolia BaoTou | Ye Chiu vs. Jiangxi Ganfeng Lithium |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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