Correlation Between Malion New and China Building
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By analyzing existing cross correlation between Malion New Materials and China Building Material, you can compare the effects of market volatilities on Malion New and China Building 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 Malion New with a short position of China Building. Check out your portfolio center. Please also check ongoing floating volatility patterns of Malion New and China Building.
Diversification Opportunities for Malion New and China Building
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Malion and China is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Malion New Materials and China Building Material in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Building Material and Malion New 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 Malion New Materials are associated (or correlated) with China Building. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Building Material has no effect on the direction of Malion New i.e., Malion New and China Building go up and down completely randomly.
Pair Corralation between Malion New and China Building
Assuming the 90 days trading horizon Malion New Materials is expected to under-perform the China Building. In addition to that, Malion New is 1.43 times more volatile than China Building Material. It trades about -0.03 of its total potential returns per unit of risk. China Building Material is currently generating about -0.04 per unit of volatility. If you would invest 1,150 in China Building Material on October 15, 2024 and sell it today you would lose (480.00) from holding China Building Material or give up 41.74% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Malion New Materials vs. China Building Material
Performance |
| Timeline |
| Malion New Materials |
| China Building Material |
Malion New and China Building Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Malion New and China Building
The main advantage of trading using opposite Malion New and China Building positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Malion New position performs unexpectedly, China Building 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 Building will offset losses from the drop in China Building's long position.| Malion New vs. Anshan Senyuan Road | Malion New vs. Citic Offshore Helicopter | Malion New vs. CSSC Offshore Marine | Malion New vs. Zhongshan Broad Ocean Motor |
| China Building vs. Jiangsu Phoenix Publishing | China Building vs. Citic Guoan Wine | China Building vs. Bank of Communications | China Building vs. Shanghai Action Education |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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