Correlation Between Guangdong Tengen and Aluminum Corp
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By analyzing existing cross correlation between Guangdong Tengen Industrial and Aluminum Corp of, you can compare the effects of market volatilities on Guangdong Tengen and Aluminum Corp 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 Guangdong Tengen with a short position of Aluminum Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Tengen and Aluminum Corp.
Diversification Opportunities for Guangdong Tengen and Aluminum Corp
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Guangdong and Aluminum is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Tengen Industrial and Aluminum Corp of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aluminum Corp and Guangdong Tengen 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 Guangdong Tengen Industrial are associated (or correlated) with Aluminum Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aluminum Corp has no effect on the direction of Guangdong Tengen i.e., Guangdong Tengen and Aluminum Corp go up and down completely randomly.
Pair Corralation between Guangdong Tengen and Aluminum Corp
Assuming the 90 days trading horizon Guangdong Tengen is expected to generate 10.26 times less return on investment than Aluminum Corp. In addition to that, Guangdong Tengen is 1.22 times more volatile than Aluminum Corp of. It trades about 0.01 of its total potential returns per unit of risk. Aluminum Corp of is currently generating about 0.08 per unit of volatility. If you would invest 508.00 in Aluminum Corp of on September 12, 2024 and sell it today you would earn a total of 280.00 from holding Aluminum Corp of or generate 55.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Tengen Industrial vs. Aluminum Corp of
Performance |
| Timeline |
| Guangdong Tengen Ind |
| Aluminum Corp |
Guangdong Tengen and Aluminum Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Tengen and Aluminum Corp
The main advantage of trading using opposite Guangdong Tengen and Aluminum Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Tengen position performs unexpectedly, Aluminum Corp 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 Aluminum Corp will offset losses from the drop in Aluminum Corp's long position.| Guangdong Tengen vs. Chongqing Shunbo Aluminum | Guangdong Tengen vs. Aluminum Corp of | Guangdong Tengen vs. Guangdong Jingyi Metal | Guangdong Tengen vs. Hefei Metalforming Mach |
| Aluminum Corp vs. Zijin Mining Group | Aluminum Corp vs. Wanhua Chemical Group | Aluminum Corp vs. Baoshan Iron Steel | Aluminum Corp vs. Rongsheng Petrochemical Co |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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