Correlation Between Fujian Nanwang and Changjiang Jinggong
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By analyzing existing cross correlation between Fujian Nanwang Environment and Changjiang Jinggong Steel, you can compare the effects of market volatilities on Fujian Nanwang and Changjiang Jinggong 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 Fujian Nanwang with a short position of Changjiang Jinggong. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fujian Nanwang and Changjiang Jinggong.
Diversification Opportunities for Fujian Nanwang and Changjiang Jinggong
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Fujian and Changjiang is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Fujian Nanwang Environment and Changjiang Jinggong Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changjiang Jinggong Steel and Fujian Nanwang 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 Fujian Nanwang Environment are associated (or correlated) with Changjiang Jinggong. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changjiang Jinggong Steel has no effect on the direction of Fujian Nanwang i.e., Fujian Nanwang and Changjiang Jinggong go up and down completely randomly.
Pair Corralation between Fujian Nanwang and Changjiang Jinggong
Assuming the 90 days trading horizon Fujian Nanwang Environment is expected to under-perform the Changjiang Jinggong. In addition to that, Fujian Nanwang is 1.7 times more volatile than Changjiang Jinggong Steel. It trades about -0.05 of its total potential returns per unit of risk. Changjiang Jinggong Steel is currently generating about -0.04 per unit of volatility. If you would invest 422.00 in Changjiang Jinggong Steel on November 2, 2024 and sell it today you would lose (128.00) from holding Changjiang Jinggong Steel or give up 30.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 83.09% |
| Values | Daily Returns |
Fujian Nanwang Environment vs. Changjiang Jinggong Steel
Performance |
| Timeline |
| Fujian Nanwang Envir |
| Changjiang Jinggong Steel |
Fujian Nanwang and Changjiang Jinggong Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fujian Nanwang and Changjiang Jinggong
The main advantage of trading using opposite Fujian Nanwang and Changjiang Jinggong positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fujian Nanwang position performs unexpectedly, Changjiang Jinggong 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 Changjiang Jinggong will offset losses from the drop in Changjiang Jinggong's long position.| Fujian Nanwang vs. Zijin Mining Group | Fujian Nanwang vs. Wanhua Chemical Group | Fujian Nanwang vs. Baoshan Iron Steel | Fujian Nanwang vs. Shandong Gold Mining |
| Changjiang Jinggong vs. Industrial and Commercial | Changjiang Jinggong vs. Kweichow Moutai Co | Changjiang Jinggong vs. Agricultural Bank of | Changjiang Jinggong vs. China Mobile Limited |
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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