Correlation Between Baoshan Iron and Orinko Advanced
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By analyzing existing cross correlation between Baoshan Iron Steel and Orinko Advanced Plastics, you can compare the effects of market volatilities on Baoshan Iron and Orinko Advanced 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 Orinko Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Baoshan Iron and Orinko Advanced.
Diversification Opportunities for Baoshan Iron and Orinko Advanced
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Baoshan and Orinko is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Baoshan Iron Steel and Orinko Advanced Plastics in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Orinko Advanced Plastics 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 Orinko Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Orinko Advanced Plastics has no effect on the direction of Baoshan Iron i.e., Baoshan Iron and Orinko Advanced go up and down completely randomly.
Pair Corralation between Baoshan Iron and Orinko Advanced
Assuming the 90 days trading horizon Baoshan Iron Steel is expected to under-perform the Orinko Advanced. But the stock apears to be less risky and, when comparing its historical volatility, Baoshan Iron Steel is 1.42 times less risky than Orinko Advanced. The stock trades about -0.06 of its potential returns per unit of risk. The Orinko Advanced Plastics is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 889.00 in Orinko Advanced Plastics on August 30, 2024 and sell it today you would earn a total of 29.00 from holding Orinko Advanced Plastics or generate 3.26% 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. Orinko Advanced Plastics
Performance |
| Timeline |
| Baoshan Iron Steel |
| Orinko Advanced Plastics |
Baoshan Iron and Orinko Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Baoshan Iron and Orinko Advanced
The main advantage of trading using opposite Baoshan Iron and Orinko Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Baoshan Iron position performs unexpectedly, Orinko Advanced 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 Orinko Advanced will offset losses from the drop in Orinko Advanced'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 |
| Orinko Advanced vs. Xinjiang Baodi Mining | Orinko Advanced vs. Hainan Mining Co | Orinko Advanced vs. Fujian Anjoy Foods | Orinko Advanced vs. Guocheng Mining 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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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