Correlation Between Dongfeng Automobile and Jiaozuo Wanfang
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By analyzing existing cross correlation between Dongfeng Automobile Co and Jiaozuo Wanfang Aluminum, you can compare the effects of market volatilities on Dongfeng Automobile and Jiaozuo Wanfang 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 Dongfeng Automobile with a short position of Jiaozuo Wanfang. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongfeng Automobile and Jiaozuo Wanfang.
Diversification Opportunities for Dongfeng Automobile and Jiaozuo Wanfang
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Dongfeng and Jiaozuo is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Dongfeng Automobile Co and Jiaozuo Wanfang Aluminum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiaozuo Wanfang Aluminum and Dongfeng Automobile 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 Dongfeng Automobile Co are associated (or correlated) with Jiaozuo Wanfang. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiaozuo Wanfang Aluminum has no effect on the direction of Dongfeng Automobile i.e., Dongfeng Automobile and Jiaozuo Wanfang go up and down completely randomly.
Pair Corralation between Dongfeng Automobile and Jiaozuo Wanfang
Assuming the 90 days trading horizon Dongfeng Automobile Co is expected to under-perform the Jiaozuo Wanfang. In addition to that, Dongfeng Automobile is 1.33 times more volatile than Jiaozuo Wanfang Aluminum. It trades about -0.18 of its total potential returns per unit of risk. Jiaozuo Wanfang Aluminum is currently generating about 0.26 per unit of volatility. If you would invest 652.00 in Jiaozuo Wanfang Aluminum on October 28, 2024 and sell it today you would earn a total of 79.00 from holding Jiaozuo Wanfang Aluminum or generate 12.12% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dongfeng Automobile Co vs. Jiaozuo Wanfang Aluminum
Performance |
| Timeline |
| Dongfeng Automobile |
| Jiaozuo Wanfang Aluminum |
Dongfeng Automobile and Jiaozuo Wanfang Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongfeng Automobile and Jiaozuo Wanfang
The main advantage of trading using opposite Dongfeng Automobile and Jiaozuo Wanfang positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongfeng Automobile position performs unexpectedly, Jiaozuo Wanfang 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 Jiaozuo Wanfang will offset losses from the drop in Jiaozuo Wanfang's long position.| Dongfeng Automobile vs. StarPower Semiconductor | Dongfeng Automobile vs. Fujian Longzhou Transportation | Dongfeng Automobile vs. Thinkon Semiconductor Jinzhou | Dongfeng Automobile vs. Will Semiconductor Co |
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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 Top Crypto Exchanges module to search and analyze digital assets across top global cryptocurrency exchanges.
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