Correlation Between Western Metal and Qumei Furniture
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By analyzing existing cross correlation between Western Metal Materials and Qumei Furniture Group, you can compare the effects of market volatilities on Western Metal and Qumei Furniture 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 Qumei Furniture. Check out your portfolio center. Please also check ongoing floating volatility patterns of Western Metal and Qumei Furniture.
Diversification Opportunities for Western Metal and Qumei Furniture
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Western and Qumei is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Western Metal Materials and Qumei Furniture Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Qumei Furniture Group 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 Qumei Furniture. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Qumei Furniture Group has no effect on the direction of Western Metal i.e., Western Metal and Qumei Furniture go up and down completely randomly.
Pair Corralation between Western Metal and Qumei Furniture
Assuming the 90 days trading horizon Western Metal Materials is expected to generate 0.86 times more return on investment than Qumei Furniture. However, Western Metal Materials is 1.16 times less risky than Qumei Furniture. It trades about 0.03 of its potential returns per unit of risk. Qumei Furniture Group is currently generating about -0.04 per unit of risk. If you would invest 1,501 in Western Metal Materials on October 16, 2024 and sell it today you would earn a total of 287.00 from holding Western Metal Materials or generate 19.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Western Metal Materials vs. Qumei Furniture Group
Performance |
| Timeline |
| Western Metal Materials |
| Qumei Furniture Group |
Western Metal and Qumei Furniture Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Western Metal and Qumei Furniture
The main advantage of trading using opposite Western Metal and Qumei Furniture positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Western Metal position performs unexpectedly, Qumei Furniture 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 Qumei Furniture will offset losses from the drop in Qumei Furniture's long position.| Western Metal vs. China Mobile Limited | Western Metal vs. Sihui Fuji Electronics | Western Metal vs. Dongguan Tarry Electronics | Western Metal vs. Tongyu Communication |
| Qumei Furniture vs. Cultural Investment Holdings | Qumei Furniture vs. Western Metal Materials | Qumei Furniture vs. Qingdao Choho Industrial | Qumei Furniture vs. Gem Year Industrial Co |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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