Correlation Between Shandong Hongchuang and Beijing Jiaman
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By analyzing existing cross correlation between Shandong Hongchuang Aluminum and Beijing Jiaman Dress, you can compare the effects of market volatilities on Shandong Hongchuang and Beijing Jiaman 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 Shandong Hongchuang with a short position of Beijing Jiaman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shandong Hongchuang and Beijing Jiaman.
Diversification Opportunities for Shandong Hongchuang and Beijing Jiaman
-0.61 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Shandong and Beijing is -0.61. Overlapping area represents the amount of risk that can be diversified away by holding Shandong Hongchuang Aluminum and Beijing Jiaman Dress in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Jiaman Dress and Shandong Hongchuang 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 Shandong Hongchuang Aluminum are associated (or correlated) with Beijing Jiaman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Jiaman Dress has no effect on the direction of Shandong Hongchuang i.e., Shandong Hongchuang and Beijing Jiaman go up and down completely randomly.
Pair Corralation between Shandong Hongchuang and Beijing Jiaman
Assuming the 90 days trading horizon Shandong Hongchuang Aluminum is expected to generate 1.94 times more return on investment than Beijing Jiaman. However, Shandong Hongchuang is 1.94 times more volatile than Beijing Jiaman Dress. It trades about 0.21 of its potential returns per unit of risk. Beijing Jiaman Dress is currently generating about -0.03 per unit of risk. If you would invest 897.00 in Shandong Hongchuang Aluminum on November 1, 2024 and sell it today you would earn a total of 144.00 from holding Shandong Hongchuang Aluminum or generate 16.05% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 95.0% |
| Values | Daily Returns |
Shandong Hongchuang Aluminum vs. Beijing Jiaman Dress
Performance |
| Timeline |
| Shandong Hongchuang |
| Beijing Jiaman Dress |
Shandong Hongchuang and Beijing Jiaman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shandong Hongchuang and Beijing Jiaman
The main advantage of trading using opposite Shandong Hongchuang and Beijing Jiaman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shandong Hongchuang position performs unexpectedly, Beijing Jiaman 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 Beijing Jiaman will offset losses from the drop in Beijing Jiaman's long position.| Shandong Hongchuang vs. Zijin Mining Group | Shandong Hongchuang vs. Wanhua Chemical Group | Shandong Hongchuang vs. Baoshan Iron Steel | Shandong Hongchuang vs. Shandong Gold Mining |
| Beijing Jiaman vs. CITIC Metal Co | Beijing Jiaman vs. Shandong Hongchuang Aluminum | Beijing Jiaman vs. Shanghai Jinfeng Wine | Beijing Jiaman vs. Anhui Transport Consulting |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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