Correlation Between Tianshan Aluminum and Zhejiang Yongjin
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By analyzing existing cross correlation between Tianshan Aluminum Group and Zhejiang Yongjin Metal, you can compare the effects of market volatilities on Tianshan Aluminum and Zhejiang Yongjin 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 Zhejiang Yongjin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tianshan Aluminum and Zhejiang Yongjin.
Diversification Opportunities for Tianshan Aluminum and Zhejiang Yongjin
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Tianshan and Zhejiang is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Tianshan Aluminum Group and Zhejiang Yongjin Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Yongjin Metal 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 Zhejiang Yongjin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Yongjin Metal has no effect on the direction of Tianshan Aluminum i.e., Tianshan Aluminum and Zhejiang Yongjin go up and down completely randomly.
Pair Corralation between Tianshan Aluminum and Zhejiang Yongjin
Assuming the 90 days trading horizon Tianshan Aluminum Group is expected to generate 1.0 times more return on investment than Zhejiang Yongjin. However, Tianshan Aluminum is 1.0 times more volatile than Zhejiang Yongjin Metal. It trades about 0.02 of its potential returns per unit of risk. Zhejiang Yongjin Metal is currently generating about -0.02 per unit of risk. If you would invest 731.00 in Tianshan Aluminum Group on September 12, 2024 and sell it today you would earn a total of 89.00 from holding Tianshan Aluminum Group or generate 12.18% 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. Zhejiang Yongjin Metal
Performance |
| Timeline |
| Tianshan Aluminum |
| Zhejiang Yongjin Metal |
Tianshan Aluminum and Zhejiang Yongjin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Tianshan Aluminum and Zhejiang Yongjin
The main advantage of trading using opposite Tianshan Aluminum and Zhejiang Yongjin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tianshan Aluminum position performs unexpectedly, Zhejiang Yongjin 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 Zhejiang Yongjin will offset losses from the drop in Zhejiang Yongjin's long position.| Tianshan Aluminum vs. Agricultural Bank of | Tianshan Aluminum vs. Industrial and Commercial | Tianshan Aluminum vs. Bank of China | Tianshan Aluminum vs. PetroChina Co Ltd |
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 Commodity Directory module to find actively traded commodities issued by global exchanges.
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