Correlation Between Baoshan Iron and Luyin Investment
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By analyzing existing cross correlation between Baoshan Iron Steel and Luyin Investment Group, you can compare the effects of market volatilities on Baoshan Iron and Luyin Investment 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 Luyin Investment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baoshan Iron and Luyin Investment.
Diversification Opportunities for Baoshan Iron and Luyin Investment
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Baoshan and Luyin is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Baoshan Iron Steel and Luyin Investment Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Luyin Investment 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 Luyin Investment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Luyin Investment has no effect on the direction of Baoshan Iron i.e., Baoshan Iron and Luyin Investment go up and down completely randomly.
Pair Corralation between Baoshan Iron and Luyin Investment
Assuming the 90 days trading horizon Baoshan Iron Steel is expected to under-perform the Luyin Investment. In addition to that, Baoshan Iron is 1.14 times more volatile than Luyin Investment Group. It trades about -0.05 of its total potential returns per unit of risk. Luyin Investment Group is currently generating about 0.08 per unit of volatility. If you would invest 573.00 in Luyin Investment Group on August 29, 2024 and sell it today you would earn a total of 32.00 from holding Luyin Investment Group or generate 5.58% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baoshan Iron Steel vs. Luyin Investment Group
Performance |
| Timeline |
| Baoshan Iron Steel |
| Luyin Investment |
Baoshan Iron and Luyin Investment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baoshan Iron and Luyin Investment
The main advantage of trading using opposite Baoshan Iron and Luyin Investment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baoshan Iron position performs unexpectedly, Luyin Investment 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 Luyin Investment will offset losses from the drop in Luyin Investment's long position.| Baoshan Iron vs. Shandong Gold Mining | Baoshan Iron vs. Rongsheng Petrochemical Co | Baoshan Iron vs. Inner Mongolia BaoTou | Baoshan Iron vs. Jiangxi Ganfeng Lithium |
| Luyin Investment vs. Baoshan Iron Steel | Luyin Investment vs. Shandong Gold Mining | Luyin Investment vs. Rongsheng Petrochemical Co | Luyin Investment vs. Inner Mongolia BaoTou |
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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