Correlation Between Wangsu Science and Gansu Jiu
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By analyzing existing cross correlation between Wangsu Science Tech and Gansu Jiu Steel, you can compare the effects of market volatilities on Wangsu Science and Gansu Jiu 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 Wangsu Science with a short position of Gansu Jiu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wangsu Science and Gansu Jiu.
Diversification Opportunities for Wangsu Science and Gansu Jiu
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Wangsu and Gansu is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Wangsu Science Tech and Gansu Jiu Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gansu Jiu Steel and Wangsu Science 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 Wangsu Science Tech are associated (or correlated) with Gansu Jiu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gansu Jiu Steel has no effect on the direction of Wangsu Science i.e., Wangsu Science and Gansu Jiu go up and down completely randomly.
Pair Corralation between Wangsu Science and Gansu Jiu
Assuming the 90 days trading horizon Wangsu Science Tech is expected to generate 1.9 times more return on investment than Gansu Jiu. However, Wangsu Science is 1.9 times more volatile than Gansu Jiu Steel. It trades about -0.16 of its potential returns per unit of risk. Gansu Jiu Steel is currently generating about -0.33 per unit of risk. If you would invest 1,098 in Wangsu Science Tech on October 20, 2024 and sell it today you would lose (151.00) from holding Wangsu Science Tech or give up 13.75% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wangsu Science Tech vs. Gansu Jiu Steel
Performance |
| Timeline |
| Wangsu Science Tech |
| Gansu Jiu Steel |
Wangsu Science and Gansu Jiu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wangsu Science and Gansu Jiu
The main advantage of trading using opposite Wangsu Science and Gansu Jiu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wangsu Science position performs unexpectedly, Gansu Jiu 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 Gansu Jiu will offset losses from the drop in Gansu Jiu's long position.| Wangsu Science vs. Industrial and Commercial | Wangsu Science vs. Agricultural Bank of | Wangsu Science vs. China Construction Bank | Wangsu Science vs. Bank of China |
| Gansu Jiu vs. Shandong Iron and | Gansu Jiu vs. Bohai Leasing Co | Gansu Jiu vs. Penyao Environmental Protection | Gansu Jiu vs. Tianjin Capital Environmental |
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 Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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