Correlation Between Guangdong Jingyi and Tongling Nonferrous
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By analyzing existing cross correlation between Guangdong Jingyi Metal and Tongling Nonferrous Metals, you can compare the effects of market volatilities on Guangdong Jingyi and Tongling Nonferrous 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 Guangdong Jingyi with a short position of Tongling Nonferrous. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Jingyi and Tongling Nonferrous.
Diversification Opportunities for Guangdong Jingyi and Tongling Nonferrous
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guangdong and Tongling is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Jingyi Metal and Tongling Nonferrous Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tongling Nonferrous and Guangdong Jingyi 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 Guangdong Jingyi Metal are associated (or correlated) with Tongling Nonferrous. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tongling Nonferrous has no effect on the direction of Guangdong Jingyi i.e., Guangdong Jingyi and Tongling Nonferrous go up and down completely randomly.
Pair Corralation between Guangdong Jingyi and Tongling Nonferrous
Assuming the 90 days trading horizon Guangdong Jingyi Metal is expected to generate 2.3 times more return on investment than Tongling Nonferrous. However, Guangdong Jingyi is 2.3 times more volatile than Tongling Nonferrous Metals. It trades about 0.08 of its potential returns per unit of risk. Tongling Nonferrous Metals is currently generating about -0.04 per unit of risk. If you would invest 697.00 in Guangdong Jingyi Metal on October 28, 2024 and sell it today you would earn a total of 26.00 from holding Guangdong Jingyi Metal or generate 3.73% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Jingyi Metal vs. Tongling Nonferrous Metals
Performance |
| Timeline |
| Guangdong Jingyi Metal |
| Tongling Nonferrous |
Guangdong Jingyi and Tongling Nonferrous Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Jingyi and Tongling Nonferrous
The main advantage of trading using opposite Guangdong Jingyi and Tongling Nonferrous positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Jingyi position performs unexpectedly, Tongling Nonferrous 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 Tongling Nonferrous will offset losses from the drop in Tongling Nonferrous' long position.| Guangdong Jingyi vs. Xiamen Bank Co | Guangdong Jingyi vs. Time Publishing and | Guangdong Jingyi vs. Zhejiang Publishing Media | Guangdong Jingyi vs. COL Digital Publishing |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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