Correlation Between Shantou Wanshun and Baoshan Iron
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By analyzing existing cross correlation between Shantou Wanshun Package and Baoshan Iron Steel, you can compare the effects of market volatilities on Shantou Wanshun and Baoshan Iron 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 Shantou Wanshun with a short position of Baoshan Iron. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shantou Wanshun and Baoshan Iron.
Diversification Opportunities for Shantou Wanshun and Baoshan Iron
-0.18 | Correlation Coefficient |
Good diversification
The 3 months correlation between Shantou and Baoshan is -0.18. Overlapping area represents the amount of risk that can be diversified away by holding Shantou Wanshun Package and Baoshan Iron Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baoshan Iron Steel and Shantou Wanshun 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 Shantou Wanshun Package are associated (or correlated) with Baoshan Iron. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baoshan Iron Steel has no effect on the direction of Shantou Wanshun i.e., Shantou Wanshun and Baoshan Iron go up and down completely randomly.
Pair Corralation between Shantou Wanshun and Baoshan Iron
Assuming the 90 days trading horizon Shantou Wanshun Package is expected to generate 1.85 times more return on investment than Baoshan Iron. However, Shantou Wanshun is 1.85 times more volatile than Baoshan Iron Steel. It trades about 0.05 of its potential returns per unit of risk. Baoshan Iron Steel is currently generating about 0.0 per unit of risk. If you would invest 391.00 in Shantou Wanshun Package on October 7, 2024 and sell it today you would earn a total of 60.00 from holding Shantou Wanshun Package or generate 15.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shantou Wanshun Package vs. Baoshan Iron Steel
Performance |
| Timeline |
| Shantou Wanshun Package |
| Baoshan Iron Steel |
Shantou Wanshun and Baoshan Iron Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shantou Wanshun and Baoshan Iron
The main advantage of trading using opposite Shantou Wanshun and Baoshan Iron positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shantou Wanshun position performs unexpectedly, Baoshan Iron 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 Baoshan Iron will offset losses from the drop in Baoshan Iron's long position.| Shantou Wanshun vs. Zijin Mining Group | Shantou Wanshun vs. Wanhua Chemical Group | Shantou Wanshun vs. Baoshan Iron Steel | Shantou Wanshun vs. Rongsheng Petrochemical Co |
| Baoshan Iron vs. Zijin Mining Group | Baoshan Iron vs. Wanhua Chemical Group | Baoshan Iron vs. Rongsheng Petrochemical Co | Baoshan Iron vs. Hoshine Silicon Ind |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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