Correlation Between Cngr Advanced and Wanhua Chemical
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By analyzing existing cross correlation between Cngr Advanced Material and Wanhua Chemical Group, you can compare the effects of market volatilities on Cngr Advanced and Wanhua Chemical 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 Cngr Advanced with a short position of Wanhua Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Cngr Advanced and Wanhua Chemical.
Diversification Opportunities for Cngr Advanced and Wanhua Chemical
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Cngr and Wanhua is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Cngr Advanced Material and Wanhua Chemical Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wanhua Chemical Group and Cngr Advanced 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 Cngr Advanced Material are associated (or correlated) with Wanhua Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wanhua Chemical Group has no effect on the direction of Cngr Advanced i.e., Cngr Advanced and Wanhua Chemical go up and down completely randomly.
Pair Corralation between Cngr Advanced and Wanhua Chemical
Assuming the 90 days trading horizon Cngr Advanced Material is expected to generate 2.3 times more return on investment than Wanhua Chemical. However, Cngr Advanced is 2.3 times more volatile than Wanhua Chemical Group. It trades about 0.07 of its potential returns per unit of risk. Wanhua Chemical Group is currently generating about -0.03 per unit of risk. If you would invest 3,843 in Cngr Advanced Material on September 1, 2024 and sell it today you would earn a total of 155.00 from holding Cngr Advanced Material or generate 4.03% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Cngr Advanced Material vs. Wanhua Chemical Group
Performance |
| Timeline |
| Cngr Advanced Material |
| Wanhua Chemical Group |
Cngr Advanced and Wanhua Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Cngr Advanced and Wanhua Chemical
The main advantage of trading using opposite Cngr Advanced and Wanhua Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Cngr Advanced position performs unexpectedly, Wanhua Chemical 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 Wanhua Chemical will offset losses from the drop in Wanhua Chemical's long position.| Cngr Advanced vs. Kunwu Jiuding Investment | Cngr Advanced vs. Luyin Investment Group | Cngr Advanced vs. Jointo Energy Investment | Cngr Advanced vs. Metro Investment Development |
| Wanhua Chemical vs. Zijin Mining Group | Wanhua Chemical vs. Baoshan Iron Steel | Wanhua Chemical vs. Shandong Gold Mining | Wanhua Chemical 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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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