Correlation Between Yili Chuanning and Industrial
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By analyzing existing cross correlation between Yili Chuanning Biotechnology and Industrial and Commercial, you can compare the effects of market volatilities on Yili Chuanning and Industrial 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 Yili Chuanning with a short position of Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Yili Chuanning and Industrial.
Diversification Opportunities for Yili Chuanning and Industrial
-0.46 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Yili and Industrial is -0.46. Overlapping area represents the amount of risk that can be diversified away by holding Yili Chuanning Biotechnology and Industrial and Commercial in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industrial and Commercial and Yili Chuanning 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 Yili Chuanning Biotechnology are associated (or correlated) with Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industrial and Commercial has no effect on the direction of Yili Chuanning i.e., Yili Chuanning and Industrial go up and down completely randomly.
Pair Corralation between Yili Chuanning and Industrial
Assuming the 90 days trading horizon Yili Chuanning is expected to generate 1.92 times less return on investment than Industrial. In addition to that, Yili Chuanning is 1.24 times more volatile than Industrial and Commercial. It trades about 0.06 of its total potential returns per unit of risk. Industrial and Commercial is currently generating about 0.15 per unit of volatility. If you would invest 661.00 in Industrial and Commercial on November 7, 2024 and sell it today you would earn a total of 21.00 from holding Industrial and Commercial or generate 3.18% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Yili Chuanning Biotechnology vs. Industrial and Commercial
Performance |
| Timeline |
| Yili Chuanning Biote |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Industrial and Commercial |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Good
Yili Chuanning and Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Yili Chuanning and Industrial
The main advantage of trading using opposite Yili Chuanning and Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Yili Chuanning position performs unexpectedly, Industrial 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 Industrial will offset losses from the drop in Industrial's long position.The idea behind Yili Chuanning Biotechnology and Industrial and Commercial pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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