Correlation Between Gansu Jiu and Zhongrun Resources
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By analyzing existing cross correlation between Gansu Jiu Steel and Zhongrun Resources Investment, you can compare the effects of market volatilities on Gansu Jiu and Zhongrun Resources 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 Gansu Jiu with a short position of Zhongrun Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gansu Jiu and Zhongrun Resources.
Diversification Opportunities for Gansu Jiu and Zhongrun Resources
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Gansu and Zhongrun is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Gansu Jiu Steel and Zhongrun Resources Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongrun Resources and Gansu Jiu 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 Gansu Jiu Steel are associated (or correlated) with Zhongrun Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongrun Resources has no effect on the direction of Gansu Jiu i.e., Gansu Jiu and Zhongrun Resources go up and down completely randomly.
Pair Corralation between Gansu Jiu and Zhongrun Resources
Assuming the 90 days trading horizon Gansu Jiu Steel is expected to generate 0.52 times more return on investment than Zhongrun Resources. However, Gansu Jiu Steel is 1.91 times less risky than Zhongrun Resources. It trades about 0.02 of its potential returns per unit of risk. Zhongrun Resources Investment is currently generating about -0.01 per unit of risk. If you would invest 157.00 in Gansu Jiu Steel on August 27, 2024 and sell it today you would earn a total of 6.00 from holding Gansu Jiu Steel or generate 3.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.58% |
| Values | Daily Returns |
Gansu Jiu Steel vs. Zhongrun Resources Investment
Performance |
| Timeline |
| Gansu Jiu Steel |
| Zhongrun Resources |
Gansu Jiu and Zhongrun Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gansu Jiu and Zhongrun Resources
The main advantage of trading using opposite Gansu Jiu and Zhongrun Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gansu Jiu position performs unexpectedly, Zhongrun Resources 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 Zhongrun Resources will offset losses from the drop in Zhongrun Resources' long position.| Gansu Jiu vs. Wanhua Chemical Group | Gansu Jiu vs. Shandong Gold Mining | Gansu Jiu vs. Rongsheng Petrochemical Co | Gansu Jiu vs. Inner Mongolia BaoTou |
| Zhongrun Resources vs. Industrial and Commercial | Zhongrun Resources vs. China Construction Bank | Zhongrun Resources vs. Bank of China | Zhongrun Resources vs. Agricultural Bank of |
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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