Correlation Between China Asset and China Aluminum
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By analyzing existing cross correlation between China Asset Management and China Aluminum International, you can compare the effects of market volatilities on China Asset and China Aluminum 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 China Asset with a short position of China Aluminum. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Asset and China Aluminum.
Diversification Opportunities for China Asset and China Aluminum
-0.91 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between China and China is -0.91. Overlapping area represents the amount of risk that can be diversified away by holding China Asset Management and China Aluminum International in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Aluminum Inter and China Asset 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 China Asset Management are associated (or correlated) with China Aluminum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Aluminum Inter has no effect on the direction of China Asset i.e., China Asset and China Aluminum go up and down completely randomly.
Pair Corralation between China Asset and China Aluminum
Assuming the 90 days trading horizon China Asset Management is expected to generate 0.68 times more return on investment than China Aluminum. However, China Asset Management is 1.46 times less risky than China Aluminum. It trades about 0.48 of its potential returns per unit of risk. China Aluminum International is currently generating about -0.17 per unit of risk. If you would invest 316.00 in China Asset Management on October 30, 2024 and sell it today you would earn a total of 80.00 from holding China Asset Management or generate 25.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Asset Management vs. China Aluminum International
Performance |
| Timeline |
| China Asset Management |
| China Aluminum Inter |
China Asset and China Aluminum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Asset and China Aluminum
The main advantage of trading using opposite China Asset and China Aluminum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Asset position performs unexpectedly, China Aluminum 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 Aluminum will offset losses from the drop in China Aluminum's long position.| China Asset vs. Ningbo Construction Co | China Asset vs. Eastroc Beverage Group | China Asset vs. Anhui Huaheng Biotechnology | China Asset vs. Allied Machinery Co |
| China Aluminum vs. Industrial and Commercial | China Aluminum vs. China Construction Bank | China Aluminum vs. Agricultural Bank of | China Aluminum vs. Bank of China |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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