Correlation Between Changzhou Almaden and Changjiang Jinggong
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By analyzing existing cross correlation between Changzhou Almaden Co and Changjiang Jinggong Steel, you can compare the effects of market volatilities on Changzhou Almaden and Changjiang Jinggong 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 Changzhou Almaden with a short position of Changjiang Jinggong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changzhou Almaden and Changjiang Jinggong.
Diversification Opportunities for Changzhou Almaden and Changjiang Jinggong
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Changzhou and Changjiang is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Changzhou Almaden Co and Changjiang Jinggong Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changjiang Jinggong Steel and Changzhou Almaden 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 Changzhou Almaden Co are associated (or correlated) with Changjiang Jinggong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changjiang Jinggong Steel has no effect on the direction of Changzhou Almaden i.e., Changzhou Almaden and Changjiang Jinggong go up and down completely randomly.
Pair Corralation between Changzhou Almaden and Changjiang Jinggong
Assuming the 90 days trading horizon Changzhou Almaden Co is expected to generate 1.4 times more return on investment than Changjiang Jinggong. However, Changzhou Almaden is 1.4 times more volatile than Changjiang Jinggong Steel. It trades about 0.27 of its potential returns per unit of risk. Changjiang Jinggong Steel is currently generating about 0.16 per unit of risk. If you would invest 1,454 in Changzhou Almaden Co on November 28, 2024 and sell it today you would earn a total of 95.00 from holding Changzhou Almaden Co or generate 6.53% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changzhou Almaden Co vs. Changjiang Jinggong Steel
Performance |
| Timeline |
| Changzhou Almaden |
| Changjiang Jinggong Steel |
Changzhou Almaden and Changjiang Jinggong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changzhou Almaden and Changjiang Jinggong
The main advantage of trading using opposite Changzhou Almaden and Changjiang Jinggong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changzhou Almaden position performs unexpectedly, Changjiang Jinggong 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 Changjiang Jinggong will offset losses from the drop in Changjiang Jinggong's long position.| Changzhou Almaden vs. Gan Yuan Foods | Changzhou Almaden vs. Shanghai Ziyan Foods | Changzhou Almaden vs. Guangdong Wens Foodstuff | Changzhou Almaden vs. Zhejiang Yongjin Metal |
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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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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