Correlation Between Baoshan Iron and Anhui Guofeng
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By analyzing existing cross correlation between Baoshan Iron Steel and Anhui Guofeng Plastic, you can compare the effects of market volatilities on Baoshan Iron and Anhui Guofeng 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 Baoshan Iron with a short position of Anhui Guofeng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baoshan Iron and Anhui Guofeng.
Diversification Opportunities for Baoshan Iron and Anhui Guofeng
0.18 | Correlation Coefficient |
Average diversification
The 3 months correlation between Baoshan and Anhui is 0.18. Overlapping area represents the amount of risk that can be diversified away by holding Baoshan Iron Steel and Anhui Guofeng Plastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anhui Guofeng Plastic and Baoshan Iron 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 Baoshan Iron Steel are associated (or correlated) with Anhui Guofeng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anhui Guofeng Plastic has no effect on the direction of Baoshan Iron i.e., Baoshan Iron and Anhui Guofeng go up and down completely randomly.
Pair Corralation between Baoshan Iron and Anhui Guofeng
Assuming the 90 days trading horizon Baoshan Iron Steel is expected to generate 0.45 times more return on investment than Anhui Guofeng. However, Baoshan Iron Steel is 2.24 times less risky than Anhui Guofeng. It trades about -0.24 of its potential returns per unit of risk. Anhui Guofeng Plastic is currently generating about -0.17 per unit of risk. If you would invest 702.00 in Baoshan Iron Steel on October 25, 2024 and sell it today you would lose (47.00) from holding Baoshan Iron Steel or give up 6.7% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baoshan Iron Steel vs. Anhui Guofeng Plastic
Performance |
| Timeline |
| Baoshan Iron Steel |
| Anhui Guofeng Plastic |
Baoshan Iron and Anhui Guofeng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baoshan Iron and Anhui Guofeng
The main advantage of trading using opposite Baoshan Iron and Anhui Guofeng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baoshan Iron position performs unexpectedly, Anhui Guofeng 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 Anhui Guofeng will offset losses from the drop in Anhui Guofeng's long position.| Baoshan Iron vs. Zijin Mining Group | Baoshan Iron vs. Wanhua Chemical Group | Baoshan Iron vs. Rongsheng Petrochemical Co | Baoshan Iron vs. Inner Mongolia BaoTou |
| Anhui Guofeng vs. Zijin Mining Group | Anhui Guofeng vs. Wanhua Chemical Group | Anhui Guofeng vs. Baoshan Iron Steel | Anhui Guofeng 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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