Correlation Between Chongqing Shunbo and Beijing Jiaman
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By analyzing existing cross correlation between Chongqing Shunbo Aluminum and Beijing Jiaman Dress, you can compare the effects of market volatilities on Chongqing Shunbo and Beijing Jiaman 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 Beijing Jiaman. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Shunbo and Beijing Jiaman.
Diversification Opportunities for Chongqing Shunbo and Beijing Jiaman
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Chongqing and Beijing is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Shunbo Aluminum and Beijing Jiaman Dress in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Jiaman Dress 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 Beijing Jiaman. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Jiaman Dress has no effect on the direction of Chongqing Shunbo i.e., Chongqing Shunbo and Beijing Jiaman go up and down completely randomly.
Pair Corralation between Chongqing Shunbo and Beijing Jiaman
Assuming the 90 days trading horizon Chongqing Shunbo Aluminum is expected to generate 0.96 times more return on investment than Beijing Jiaman. However, Chongqing Shunbo Aluminum is 1.04 times less risky than Beijing Jiaman. It trades about 0.15 of its potential returns per unit of risk. Beijing Jiaman Dress is currently generating about 0.13 per unit of risk. If you would invest 530.00 in Chongqing Shunbo Aluminum on September 3, 2024 and sell it today you would earn a total of 139.00 from holding Chongqing Shunbo Aluminum or generate 26.23% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chongqing Shunbo Aluminum vs. Beijing Jiaman Dress
Performance |
| Timeline |
| Chongqing Shunbo Aluminum |
| Beijing Jiaman Dress |
Chongqing Shunbo and Beijing Jiaman Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chongqing Shunbo and Beijing Jiaman
The main advantage of trading using opposite Chongqing Shunbo and Beijing Jiaman positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Shunbo position performs unexpectedly, Beijing Jiaman 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 Beijing Jiaman will offset losses from the drop in Beijing Jiaman's long position.| Chongqing Shunbo vs. Zijin Mining Group | Chongqing Shunbo vs. Baoshan Iron Steel | Chongqing Shunbo vs. Rongsheng Petrochemical Co | Chongqing Shunbo vs. Hoshine Silicon Ind |
| Beijing Jiaman vs. PetroChina Co Ltd | Beijing Jiaman vs. China Mobile Limited | Beijing Jiaman vs. Industrial and Commercial | Beijing Jiaman vs. China Life Insurance |
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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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