Correlation Between Western Metal and Sichuan Hebang
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By analyzing existing cross correlation between Western Metal Materials and Sichuan Hebang Biotechnology, you can compare the effects of market volatilities on Western Metal and Sichuan Hebang 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 Sichuan Hebang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Metal and Sichuan Hebang.
Diversification Opportunities for Western Metal and Sichuan Hebang
-0.37 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Western and Sichuan is -0.37. Overlapping area represents the amount of risk that can be diversified away by holding Western Metal Materials and Sichuan Hebang Biotechnology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sichuan Hebang Biote 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 Sichuan Hebang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sichuan Hebang Biote has no effect on the direction of Western Metal i.e., Western Metal and Sichuan Hebang go up and down completely randomly.
Pair Corralation between Western Metal and Sichuan Hebang
Assuming the 90 days trading horizon Western Metal Materials is expected to generate 1.37 times more return on investment than Sichuan Hebang. However, Western Metal is 1.37 times more volatile than Sichuan Hebang Biotechnology. It trades about 0.06 of its potential returns per unit of risk. Sichuan Hebang Biotechnology is currently generating about -0.06 per unit of risk. If you would invest 1,644 in Western Metal Materials on October 26, 2024 and sell it today you would earn a total of 109.00 from holding Western Metal Materials or generate 6.63% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Metal Materials vs. Sichuan Hebang Biotechnology
Performance |
| Timeline |
| Western Metal Materials |
| Sichuan Hebang Biote |
Western Metal and Sichuan Hebang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Metal and Sichuan Hebang
The main advantage of trading using opposite Western Metal and Sichuan Hebang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Metal position performs unexpectedly, Sichuan Hebang 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 Sichuan Hebang will offset losses from the drop in Sichuan Hebang'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 |
| Sichuan Hebang vs. Cangzhou Mingzhu Plastic | Sichuan Hebang vs. Western Metal Materials | Sichuan Hebang vs. Shandong Publishing Media | Sichuan Hebang vs. Super Dragon Engineering Plastics |
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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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