Correlation Between Sichuan Yahua and Lonkey Industrial
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By analyzing existing cross correlation between Sichuan Yahua Industrial and Lonkey Industrial Co, you can compare the effects of market volatilities on Sichuan Yahua and Lonkey Industrial 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 Sichuan Yahua with a short position of Lonkey Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sichuan Yahua and Lonkey Industrial.
Diversification Opportunities for Sichuan Yahua and Lonkey Industrial
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Sichuan and Lonkey is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Sichuan Yahua Industrial and Lonkey Industrial Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lonkey Industrial and Sichuan Yahua 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 Sichuan Yahua Industrial are associated (or correlated) with Lonkey Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lonkey Industrial has no effect on the direction of Sichuan Yahua i.e., Sichuan Yahua and Lonkey Industrial go up and down completely randomly.
Pair Corralation between Sichuan Yahua and Lonkey Industrial
Assuming the 90 days trading horizon Sichuan Yahua Industrial is expected to generate 1.32 times more return on investment than Lonkey Industrial. However, Sichuan Yahua is 1.32 times more volatile than Lonkey Industrial Co. It trades about 0.14 of its potential returns per unit of risk. Lonkey Industrial Co is currently generating about 0.12 per unit of risk. If you would invest 1,185 in Sichuan Yahua Industrial on September 12, 2024 and sell it today you would earn a total of 97.00 from holding Sichuan Yahua Industrial or generate 8.19% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sichuan Yahua Industrial vs. Lonkey Industrial Co
Performance |
| Timeline |
| Sichuan Yahua Industrial |
| Lonkey Industrial |
Sichuan Yahua and Lonkey Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sichuan Yahua and Lonkey Industrial
The main advantage of trading using opposite Sichuan Yahua and Lonkey Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sichuan Yahua position performs unexpectedly, Lonkey Industrial 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 Lonkey Industrial will offset losses from the drop in Lonkey Industrial's long position.| Sichuan Yahua vs. Zijin Mining Group | Sichuan Yahua vs. Wanhua Chemical Group | Sichuan Yahua vs. Baoshan Iron Steel | Sichuan Yahua vs. Rongsheng Petrochemical Co |
| Lonkey Industrial vs. China Petroleum Chemical | Lonkey Industrial vs. PetroChina Co Ltd | Lonkey Industrial vs. China State Construction | Lonkey Industrial vs. China Railway Group |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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