Correlation Between Baoshan Iron and Zhejiang Yongjin
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By analyzing existing cross correlation between Baoshan Iron Steel and Zhejiang Yongjin Metal, you can compare the effects of market volatilities on Baoshan Iron and Zhejiang Yongjin 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 Zhejiang Yongjin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baoshan Iron and Zhejiang Yongjin.
Diversification Opportunities for Baoshan Iron and Zhejiang Yongjin
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Baoshan and Zhejiang is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Baoshan Iron Steel and Zhejiang Yongjin Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Yongjin Metal 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 Zhejiang Yongjin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Yongjin Metal has no effect on the direction of Baoshan Iron i.e., Baoshan Iron and Zhejiang Yongjin go up and down completely randomly.
Pair Corralation between Baoshan Iron and Zhejiang Yongjin
Assuming the 90 days trading horizon Baoshan Iron Steel is expected to generate 0.94 times more return on investment than Zhejiang Yongjin. However, Baoshan Iron Steel is 1.06 times less risky than Zhejiang Yongjin. It trades about 0.0 of its potential returns per unit of risk. Zhejiang Yongjin Metal is currently generating about -0.08 per unit of risk. If you would invest 659.00 in Baoshan Iron Steel on August 25, 2024 and sell it today you would lose (3.00) from holding Baoshan Iron Steel or give up 0.46% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Baoshan Iron Steel vs. Zhejiang Yongjin Metal
Performance |
| Timeline |
| Baoshan Iron Steel |
| Zhejiang Yongjin Metal |
Baoshan Iron and Zhejiang Yongjin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baoshan Iron and Zhejiang Yongjin
The main advantage of trading using opposite Baoshan Iron and Zhejiang Yongjin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baoshan Iron position performs unexpectedly, Zhejiang Yongjin 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 Zhejiang Yongjin will offset losses from the drop in Zhejiang Yongjin's long position.| Baoshan Iron vs. Zijin Mining Group | Baoshan Iron vs. Wanhua Chemical Group | Baoshan Iron vs. Shandong Gold Mining | Baoshan Iron vs. Rongsheng Petrochemical Co |
| Zhejiang Yongjin vs. Zhejiang Yayi Metal | Zhejiang Yongjin vs. Ye Chiu Metal | Zhejiang Yongjin vs. Dalian Thermal Power | Zhejiang Yongjin vs. Lonkey Industrial Co |
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 Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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