Correlation Between Nanjing Putian and China Aluminum
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By analyzing existing cross correlation between Nanjing Putian Telecommunications and China Aluminum International, you can compare the effects of market volatilities on Nanjing Putian and China Aluminum 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 Nanjing Putian with a short position of China Aluminum. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing Putian and China Aluminum.
Diversification Opportunities for Nanjing Putian and China Aluminum
0.52 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Nanjing and China is 0.52. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing Putian Telecommunicati and China Aluminum International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Aluminum Inter and Nanjing Putian 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 Nanjing Putian Telecommunications are associated (or correlated) with China Aluminum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Aluminum Inter has no effect on the direction of Nanjing Putian i.e., Nanjing Putian and China Aluminum go up and down completely randomly.
Pair Corralation between Nanjing Putian and China Aluminum
Assuming the 90 days trading horizon Nanjing Putian Telecommunications is expected to generate 1.76 times more return on investment than China Aluminum. However, Nanjing Putian is 1.76 times more volatile than China Aluminum International. It trades about 0.2 of its potential returns per unit of risk. China Aluminum International is currently generating about 0.06 per unit of risk. If you would invest 191.00 in Nanjing Putian Telecommunications on October 18, 2024 and sell it today you would earn a total of 181.00 from holding Nanjing Putian Telecommunications or generate 94.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanjing Putian Telecommunicati vs. China Aluminum International
Performance |
| Timeline |
| Nanjing Putian Telec |
| China Aluminum Inter |
Nanjing Putian and China Aluminum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing Putian and China Aluminum
The main advantage of trading using opposite Nanjing Putian and China Aluminum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing Putian position performs unexpectedly, China Aluminum 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 China Aluminum will offset losses from the drop in China Aluminum's long position.| Nanjing Putian vs. Kangxin New Materials | Nanjing Putian vs. Cangzhou Mingzhu Plastic | Nanjing Putian vs. Hangzhou Gaoxin Rubber | Nanjing Putian vs. Western Metal Materials |
| China Aluminum vs. Dongfeng Automobile Co | China Aluminum vs. Qiaoyin Environmental Tech | China Aluminum vs. Wuhan Yangtze Communication | China Aluminum vs. Nanjing Putian Telecommunications |
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 Transaction History module to view history of all your transactions and understand their impact on performance.
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