Correlation Between Rising Nonferrous and Sanxiang Advanced
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By analyzing existing cross correlation between Rising Nonferrous Metals and Sanxiang Advanced Materials, you can compare the effects of market volatilities on Rising Nonferrous and Sanxiang 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 Rising Nonferrous with a short position of Sanxiang Advanced. Check out your portfolio center. Please also check ongoing floating volatility patterns of Rising Nonferrous and Sanxiang Advanced.
Diversification Opportunities for Rising Nonferrous and Sanxiang Advanced
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Rising and Sanxiang is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Rising Nonferrous Metals and Sanxiang Advanced Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sanxiang Advanced and Rising Nonferrous 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 Rising Nonferrous Metals are associated (or correlated) with Sanxiang Advanced. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sanxiang Advanced has no effect on the direction of Rising Nonferrous i.e., Rising Nonferrous and Sanxiang Advanced go up and down completely randomly.
Pair Corralation between Rising Nonferrous and Sanxiang Advanced
Assuming the 90 days trading horizon Rising Nonferrous Metals is expected to under-perform the Sanxiang Advanced. In addition to that, Rising Nonferrous is 1.22 times more volatile than Sanxiang Advanced Materials. It trades about -0.02 of its total potential returns per unit of risk. Sanxiang Advanced Materials is currently generating about 0.08 per unit of volatility. If you would invest 1,720 in Sanxiang Advanced Materials on October 11, 2024 and sell it today you would earn a total of 59.00 from holding Sanxiang Advanced Materials or generate 3.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Rising Nonferrous Metals vs. Sanxiang Advanced Materials
Performance |
| Timeline |
| Rising Nonferrous Metals |
| Sanxiang Advanced |
Rising Nonferrous and Sanxiang Advanced Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Rising Nonferrous and Sanxiang Advanced
The main advantage of trading using opposite Rising Nonferrous and Sanxiang Advanced positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Rising Nonferrous position performs unexpectedly, Sanxiang 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 Sanxiang Advanced will offset losses from the drop in Sanxiang Advanced's long position.| Rising Nonferrous vs. Smartgiant Technology Co | Rising Nonferrous vs. Eyebright Medical Technology | Rising Nonferrous vs. Keeson Technology Corp | Rising Nonferrous vs. Olympic Circuit Technology |
| Sanxiang Advanced vs. Bank of Communications | Sanxiang Advanced vs. Jiangxi Hengda Hi Tech | Sanxiang Advanced vs. Rising Nonferrous Metals | Sanxiang Advanced vs. Sunwave Communications 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 Volatility Analysis module to get historical volatility and risk analysis based on latest market data.
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