Correlation Between Baoshan Iron and Epoxy Base
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By analyzing existing cross correlation between Baoshan Iron Steel and Epoxy Base Electronic, you can compare the effects of market volatilities on Baoshan Iron and Epoxy Base 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 Epoxy Base. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baoshan Iron and Epoxy Base.
Diversification Opportunities for Baoshan Iron and Epoxy Base
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Baoshan and Epoxy is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Baoshan Iron Steel and Epoxy Base Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Epoxy Base Electronic 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 Epoxy Base. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Epoxy Base Electronic has no effect on the direction of Baoshan Iron i.e., Baoshan Iron and Epoxy Base go up and down completely randomly.
Pair Corralation between Baoshan Iron and Epoxy Base
Assuming the 90 days trading horizon Baoshan Iron Steel is expected to under-perform the Epoxy Base. But the stock apears to be less risky and, when comparing its historical volatility, Baoshan Iron Steel is 2.23 times less risky than Epoxy Base. The stock trades about -0.15 of its potential returns per unit of risk. The Epoxy Base Electronic is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 538.00 in Epoxy Base Electronic on August 29, 2024 and sell it today you would earn a total of 16.00 from holding Epoxy Base Electronic or generate 2.97% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baoshan Iron Steel vs. Epoxy Base Electronic
Performance |
| Timeline |
| Baoshan Iron Steel |
| Epoxy Base Electronic |
Baoshan Iron and Epoxy Base Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baoshan Iron and Epoxy Base
The main advantage of trading using opposite Baoshan Iron and Epoxy Base positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baoshan Iron position performs unexpectedly, Epoxy Base 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 Epoxy Base will offset losses from the drop in Epoxy Base's long position.| Baoshan Iron vs. Wanhua Chemical Group | Baoshan Iron vs. Shandong Gold Mining | Baoshan Iron vs. Rongsheng Petrochemical Co | Baoshan Iron vs. Inner Mongolia BaoTou |
| Epoxy Base vs. Vohringer Home Technology | Epoxy Base vs. Zhongshan Broad Ocean Motor | Epoxy Base vs. Xiamen Goldenhome Co | Epoxy Base vs. Sichuan Fulin Transportation |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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