Correlation Between Inner Mongolia and Pengxin International
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By analyzing existing cross correlation between Inner Mongolia ERDOS and Pengxin International Mining, you can compare the effects of market volatilities on Inner Mongolia and Pengxin International 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 Inner Mongolia with a short position of Pengxin International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Inner Mongolia and Pengxin International.
Diversification Opportunities for Inner Mongolia and Pengxin International
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Inner and Pengxin is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Inner Mongolia ERDOS and Pengxin International Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pengxin International and Inner Mongolia 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 Inner Mongolia ERDOS are associated (or correlated) with Pengxin International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pengxin International has no effect on the direction of Inner Mongolia i.e., Inner Mongolia and Pengxin International go up and down completely randomly.
Pair Corralation between Inner Mongolia and Pengxin International
Assuming the 90 days trading horizon Inner Mongolia ERDOS is expected to under-perform the Pengxin International. But the stock apears to be less risky and, when comparing its historical volatility, Inner Mongolia ERDOS is 1.55 times less risky than Pengxin International. The stock trades about -0.01 of its potential returns per unit of risk. The Pengxin International Mining is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 326.00 in Pengxin International Mining on August 27, 2024 and sell it today you would earn a total of 19.00 from holding Pengxin International Mining or generate 5.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Inner Mongolia ERDOS vs. Pengxin International Mining
Performance |
| Timeline |
| Inner Mongolia ERDOS |
| Pengxin International |
Inner Mongolia and Pengxin International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Inner Mongolia and Pengxin International
The main advantage of trading using opposite Inner Mongolia and Pengxin International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Inner Mongolia position performs unexpectedly, Pengxin International 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 Pengxin International will offset losses from the drop in Pengxin International's long position.| Inner Mongolia vs. Pengxin International Mining | Inner Mongolia vs. CIMC Vehicles Co | Inner Mongolia vs. Uroica Mining Safety | Inner Mongolia vs. Shengda Mining Co |
| Pengxin International vs. Wanhua Chemical Group | Pengxin International vs. Shandong Gold Mining | Pengxin International vs. Rongsheng Petrochemical Co | Pengxin International vs. Inner Mongolia BaoTou |
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 AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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