Correlation Between Tianshan Aluminum and Zhangzhou Pientzehuang
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By analyzing existing cross correlation between Tianshan Aluminum Group and Zhangzhou Pientzehuang Pharmaceutical, you can compare the effects of market volatilities on Tianshan Aluminum and Zhangzhou Pientzehuang 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 Tianshan Aluminum with a short position of Zhangzhou Pientzehuang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianshan Aluminum and Zhangzhou Pientzehuang.
Diversification Opportunities for Tianshan Aluminum and Zhangzhou Pientzehuang
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Tianshan and Zhangzhou is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Tianshan Aluminum Group and Zhangzhou Pientzehuang Pharmac in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhangzhou Pientzehuang and Tianshan Aluminum 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 Tianshan Aluminum Group are associated (or correlated) with Zhangzhou Pientzehuang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhangzhou Pientzehuang has no effect on the direction of Tianshan Aluminum i.e., Tianshan Aluminum and Zhangzhou Pientzehuang go up and down completely randomly.
Pair Corralation between Tianshan Aluminum and Zhangzhou Pientzehuang
Assuming the 90 days trading horizon Tianshan Aluminum Group is expected to generate 1.19 times more return on investment than Zhangzhou Pientzehuang. However, Tianshan Aluminum is 1.19 times more volatile than Zhangzhou Pientzehuang Pharmaceutical. It trades about 0.02 of its potential returns per unit of risk. Zhangzhou Pientzehuang Pharmaceutical is currently generating about 0.02 per unit of risk. If you would invest 794.00 in Tianshan Aluminum Group on September 3, 2024 and sell it today you would earn a total of 13.00 from holding Tianshan Aluminum Group or generate 1.64% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tianshan Aluminum Group vs. Zhangzhou Pientzehuang Pharmac
Performance |
| Timeline |
| Tianshan Aluminum |
| Zhangzhou Pientzehuang |
Tianshan Aluminum and Zhangzhou Pientzehuang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianshan Aluminum and Zhangzhou Pientzehuang
The main advantage of trading using opposite Tianshan Aluminum and Zhangzhou Pientzehuang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianshan Aluminum position performs unexpectedly, Zhangzhou Pientzehuang 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 Zhangzhou Pientzehuang will offset losses from the drop in Zhangzhou Pientzehuang's long position.| Tianshan Aluminum vs. Cultural Investment Holdings | Tianshan Aluminum vs. Gome Telecom Equipment | Tianshan Aluminum vs. Bus Online Co | Tianshan Aluminum vs. Holitech Technology 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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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