Correlation Between Baoshan Iron and Tianjin Silvery
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By analyzing existing cross correlation between Baoshan Iron Steel and Tianjin Silvery Dragon, you can compare the effects of market volatilities on Baoshan Iron and Tianjin Silvery 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 Tianjin Silvery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baoshan Iron and Tianjin Silvery.
Diversification Opportunities for Baoshan Iron and Tianjin Silvery
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Baoshan and Tianjin is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Baoshan Iron Steel and Tianjin Silvery Dragon in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tianjin Silvery Dragon 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 Tianjin Silvery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tianjin Silvery Dragon has no effect on the direction of Baoshan Iron i.e., Baoshan Iron and Tianjin Silvery go up and down completely randomly.
Pair Corralation between Baoshan Iron and Tianjin Silvery
Assuming the 90 days trading horizon Baoshan Iron Steel is expected to generate 0.86 times more return on investment than Tianjin Silvery. However, Baoshan Iron Steel is 1.17 times less risky than Tianjin Silvery. It trades about 0.22 of its potential returns per unit of risk. Tianjin Silvery Dragon is currently generating about -0.23 per unit of risk. If you would invest 690.00 in Baoshan Iron Steel on December 11, 2024 and sell it today you would earn a total of 48.00 from holding Baoshan Iron Steel or generate 6.96% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Against |
Strength | Insignificant |
Accuracy | 100.0% |
Values | Daily Returns |
Baoshan Iron Steel vs. Tianjin Silvery Dragon
Performance |
Timeline |
Baoshan Iron Steel |
Tianjin Silvery Dragon |
Baoshan Iron and Tianjin Silvery Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Baoshan Iron and Tianjin Silvery
The main advantage of trading using opposite Baoshan Iron and Tianjin Silvery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baoshan Iron position performs unexpectedly, Tianjin Silvery 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 Tianjin Silvery will offset losses from the drop in Tianjin Silvery's long position.Baoshan Iron vs. Shuhua Sports Co | Baoshan Iron vs. Weihai Honglin Electronic | Baoshan Iron vs. Aurora Optoelectronics Co | Baoshan Iron vs. Jiangsu Jinling Sports |
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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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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