Correlation Between Baoshan Iron and China Kings
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By analyzing existing cross correlation between Baoshan Iron Steel and China Kings Resources, you can compare the effects of market volatilities on Baoshan Iron and China Kings 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 China Kings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baoshan Iron and China Kings.
Diversification Opportunities for Baoshan Iron and China Kings
0.79 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Baoshan and China is 0.79. Overlapping area represents the amount of risk that can be diversified away by holding Baoshan Iron Steel and China Kings Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Kings Resources 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 China Kings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Kings Resources has no effect on the direction of Baoshan Iron i.e., Baoshan Iron and China Kings go up and down completely randomly.
Pair Corralation between Baoshan Iron and China Kings
Assuming the 90 days trading horizon Baoshan Iron Steel is expected to generate 0.68 times more return on investment than China Kings. However, Baoshan Iron Steel is 1.48 times less risky than China Kings. It trades about 0.03 of its potential returns per unit of risk. China Kings Resources is currently generating about -0.01 per unit of risk. If you would invest 566.00 in Baoshan Iron Steel on September 2, 2024 and sell it today you would earn a total of 96.00 from holding Baoshan Iron Steel or generate 16.96% 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. China Kings Resources
Performance |
| Timeline |
| Baoshan Iron Steel |
| China Kings Resources |
Baoshan Iron and China Kings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baoshan Iron and China Kings
The main advantage of trading using opposite Baoshan Iron and China Kings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baoshan Iron position performs unexpectedly, China Kings 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 China Kings will offset losses from the drop in China Kings' 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 |
| China Kings vs. Zijin Mining Group | China Kings vs. Wanhua Chemical Group | China Kings vs. Baoshan Iron Steel | China Kings vs. Shandong Gold Mining |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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