Correlation Between Tianshan Aluminum and Shanghai Material
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By analyzing existing cross correlation between Tianshan Aluminum Group and Shanghai Material Trading, you can compare the effects of market volatilities on Tianshan Aluminum and Shanghai Material 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 Shanghai Material. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianshan Aluminum and Shanghai Material.
Diversification Opportunities for Tianshan Aluminum and Shanghai Material
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Tianshan and Shanghai is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Tianshan Aluminum Group and Shanghai Material Trading in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Material Trading 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 Shanghai Material. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Material Trading has no effect on the direction of Tianshan Aluminum i.e., Tianshan Aluminum and Shanghai Material go up and down completely randomly.
Pair Corralation between Tianshan Aluminum and Shanghai Material
Assuming the 90 days trading horizon Tianshan Aluminum Group is expected to generate 0.63 times more return on investment than Shanghai Material. However, Tianshan Aluminum Group is 1.59 times less risky than Shanghai Material. It trades about 0.27 of its potential returns per unit of risk. Shanghai Material Trading is currently generating about -0.16 per unit of risk. If you would invest 808.00 in Tianshan Aluminum Group on October 24, 2024 and sell it today you would earn a total of 80.00 from holding Tianshan Aluminum Group or generate 9.9% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tianshan Aluminum Group vs. Shanghai Material Trading
Performance |
| Timeline |
| Tianshan Aluminum |
| Shanghai Material Trading |
Tianshan Aluminum and Shanghai Material Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianshan Aluminum and Shanghai Material
The main advantage of trading using opposite Tianshan Aluminum and Shanghai Material positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianshan Aluminum position performs unexpectedly, Shanghai Material 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 Shanghai Material will offset losses from the drop in Shanghai Material's long position.| Tianshan Aluminum vs. Markor International Home | Tianshan Aluminum vs. Masterwork Machinery | Tianshan Aluminum vs. Shandong Longquan Pipeline | Tianshan Aluminum vs. Oppein Home Group |
| Shanghai Material vs. Western Metal Materials | Shanghai Material vs. Bohai Leasing Co | Shanghai Material vs. Zhejiang Yongjin Metal | Shanghai Material vs. Tianshan Aluminum 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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