Correlation Between Chongqing Shunbo and Inner Mongolia
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By analyzing existing cross correlation between Chongqing Shunbo Aluminum and Inner Mongolia Yuan, you can compare the effects of market volatilities on Chongqing Shunbo and Inner Mongolia 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 Chongqing Shunbo with a short position of Inner Mongolia. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Shunbo and Inner Mongolia.
Diversification Opportunities for Chongqing Shunbo and Inner Mongolia
0.6 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Chongqing and Inner is 0.6. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Shunbo Aluminum and Inner Mongolia Yuan in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Inner Mongolia Yuan and Chongqing Shunbo 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 Chongqing Shunbo Aluminum are associated (or correlated) with Inner Mongolia. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Inner Mongolia Yuan has no effect on the direction of Chongqing Shunbo i.e., Chongqing Shunbo and Inner Mongolia go up and down completely randomly.
Pair Corralation between Chongqing Shunbo and Inner Mongolia
Assuming the 90 days trading horizon Chongqing Shunbo Aluminum is expected to under-perform the Inner Mongolia. In addition to that, Chongqing Shunbo is 1.16 times more volatile than Inner Mongolia Yuan. It trades about -0.02 of its total potential returns per unit of risk. Inner Mongolia Yuan is currently generating about -0.01 per unit of volatility. If you would invest 713.00 in Inner Mongolia Yuan on September 12, 2024 and sell it today you would lose (114.00) from holding Inner Mongolia Yuan or give up 15.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chongqing Shunbo Aluminum vs. Inner Mongolia Yuan
Performance |
| Timeline |
| Chongqing Shunbo Aluminum |
| Inner Mongolia Yuan |
Chongqing Shunbo and Inner Mongolia Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chongqing Shunbo and Inner Mongolia
The main advantage of trading using opposite Chongqing Shunbo and Inner Mongolia positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Shunbo position performs unexpectedly, Inner Mongolia 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 Inner Mongolia will offset losses from the drop in Inner Mongolia's long position.| Chongqing Shunbo vs. Zijin Mining Group | Chongqing Shunbo vs. Wanhua Chemical Group | Chongqing Shunbo vs. Baoshan Iron Steel | Chongqing Shunbo vs. Rongsheng Petrochemical Co |
| Inner Mongolia vs. HUAQIN TECHNOLOGY LTD | Inner Mongolia vs. CSSC Offshore Marine | Inner Mongolia vs. Kuangda Technology Group | Inner Mongolia vs. North Huajin Chemical |
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 Money Managers module to screen money managers from public funds and ETFs managed around the world.
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