Correlation Between Baoshan Iron and Runjian Communication
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By analyzing existing cross correlation between Baoshan Iron Steel and Runjian Communication Co, you can compare the effects of market volatilities on Baoshan Iron and Runjian Communication 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 Runjian Communication. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baoshan Iron and Runjian Communication.
Diversification Opportunities for Baoshan Iron and Runjian Communication
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Baoshan and Runjian is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Baoshan Iron Steel and Runjian Communication Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Runjian Communication 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 Runjian Communication. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Runjian Communication has no effect on the direction of Baoshan Iron i.e., Baoshan Iron and Runjian Communication go up and down completely randomly.
Pair Corralation between Baoshan Iron and Runjian Communication
Assuming the 90 days trading horizon Baoshan Iron Steel is expected to generate 0.53 times more return on investment than Runjian Communication. However, Baoshan Iron Steel is 1.89 times less risky than Runjian Communication. It trades about 0.02 of its potential returns per unit of risk. Runjian Communication Co is currently generating about -0.01 per unit of risk. If you would invest 602.00 in Baoshan Iron Steel on October 18, 2024 and sell it today you would earn a total of 66.00 from holding Baoshan Iron Steel or generate 10.96% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baoshan Iron Steel vs. Runjian Communication Co
Performance |
| Timeline |
| Baoshan Iron Steel |
| Runjian Communication |
Baoshan Iron and Runjian Communication Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baoshan Iron and Runjian Communication
The main advantage of trading using opposite Baoshan Iron and Runjian Communication positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baoshan Iron position performs unexpectedly, Runjian Communication 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 Runjian Communication will offset losses from the drop in Runjian Communication's long position.| Baoshan Iron vs. Chengdu Xingrong Investment | Baoshan Iron vs. Nuode Investment Co | Baoshan Iron vs. Youngy Health Co | Baoshan Iron vs. Dezhan HealthCare Co |
| Runjian Communication vs. Liuzhou Chemical Industry | Runjian Communication vs. Shenyang Chemical Industry | Runjian Communication vs. Baoshan Iron Steel | Runjian Communication vs. Anyang Iron Steel |
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 Sign In To Macroaxis module to sign in to explore Macroaxis' wealth optimization platform and fintech modules.
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