Correlation Between Jiangsu Yanghe and Rising Nonferrous
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By analyzing existing cross correlation between Jiangsu Yanghe Brewery and Rising Nonferrous Metals, you can compare the effects of market volatilities on Jiangsu Yanghe and Rising 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 Jiangsu Yanghe with a short position of Rising Nonferrous. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangsu Yanghe and Rising Nonferrous.
Diversification Opportunities for Jiangsu Yanghe and Rising Nonferrous
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Jiangsu and Rising is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Jiangsu Yanghe Brewery and Rising Nonferrous Metals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Rising Nonferrous Metals and Jiangsu Yanghe 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 Jiangsu Yanghe Brewery are associated (or correlated) with Rising Nonferrous. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Rising Nonferrous Metals has no effect on the direction of Jiangsu Yanghe i.e., Jiangsu Yanghe and Rising Nonferrous go up and down completely randomly.
Pair Corralation between Jiangsu Yanghe and Rising Nonferrous
Assuming the 90 days trading horizon Jiangsu Yanghe Brewery is expected to generate 0.48 times more return on investment than Rising Nonferrous. However, Jiangsu Yanghe Brewery is 2.07 times less risky than Rising Nonferrous. It trades about -0.2 of its potential returns per unit of risk. Rising Nonferrous Metals is currently generating about -0.2 per unit of risk. If you would invest 8,995 in Jiangsu Yanghe Brewery on September 12, 2024 and sell it today you would lose (411.00) from holding Jiangsu Yanghe Brewery or give up 4.57% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangsu Yanghe Brewery vs. Rising Nonferrous Metals
Performance |
| Timeline |
| Jiangsu Yanghe Brewery |
| Rising Nonferrous Metals |
Jiangsu Yanghe and Rising Nonferrous Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangsu Yanghe and Rising Nonferrous
The main advantage of trading using opposite Jiangsu Yanghe and Rising Nonferrous positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangsu Yanghe position performs unexpectedly, Rising 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 Rising Nonferrous will offset losses from the drop in Rising Nonferrous' long position.| Jiangsu Yanghe vs. China Petroleum Chemical | Jiangsu Yanghe vs. PetroChina Co Ltd | Jiangsu Yanghe vs. China State Construction | Jiangsu Yanghe vs. China Railway Group |
| Rising Nonferrous vs. Zijin Mining Group | Rising Nonferrous vs. Wanhua Chemical Group | Rising Nonferrous vs. Baoshan Iron Steel | Rising Nonferrous vs. Rongsheng Petrochemical 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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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