Correlation Between Gansu Jiu and Cangzhou Mingzhu
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By analyzing existing cross correlation between Gansu Jiu Steel and Cangzhou Mingzhu Plastic, you can compare the effects of market volatilities on Gansu Jiu and Cangzhou Mingzhu 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 Cangzhou Mingzhu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gansu Jiu and Cangzhou Mingzhu.
Diversification Opportunities for Gansu Jiu and Cangzhou Mingzhu
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Gansu and Cangzhou is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Gansu Jiu Steel and Cangzhou Mingzhu Plastic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cangzhou Mingzhu Plastic 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 Cangzhou Mingzhu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cangzhou Mingzhu Plastic has no effect on the direction of Gansu Jiu i.e., Gansu Jiu and Cangzhou Mingzhu go up and down completely randomly.
Pair Corralation between Gansu Jiu and Cangzhou Mingzhu
Assuming the 90 days trading horizon Gansu Jiu Steel is expected to generate 1.09 times more return on investment than Cangzhou Mingzhu. However, Gansu Jiu is 1.09 times more volatile than Cangzhou Mingzhu Plastic. It trades about 0.01 of its potential returns per unit of risk. Cangzhou Mingzhu Plastic is currently generating about -0.01 per unit of risk. If you would invest 171.00 in Gansu Jiu Steel on September 3, 2024 and sell it today you would lose (5.00) from holding Gansu Jiu Steel or give up 2.92% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gansu Jiu Steel vs. Cangzhou Mingzhu Plastic
Performance |
| Timeline |
| Gansu Jiu Steel |
| Cangzhou Mingzhu Plastic |
Gansu Jiu and Cangzhou Mingzhu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gansu Jiu and Cangzhou Mingzhu
The main advantage of trading using opposite Gansu Jiu and Cangzhou Mingzhu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gansu Jiu position performs unexpectedly, Cangzhou Mingzhu 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 Cangzhou Mingzhu will offset losses from the drop in Cangzhou Mingzhu's long position.| Gansu Jiu vs. Cangzhou Mingzhu Plastic | Gansu Jiu vs. Eastern Communications Co | Gansu Jiu vs. Western Metal Materials | Gansu Jiu vs. Ningbo Tip Rubber |
| Cangzhou Mingzhu vs. Gansu Jiu Steel | Cangzhou Mingzhu vs. Ming Yang Smart | Cangzhou Mingzhu vs. Aba Chemicals Corp | Cangzhou Mingzhu vs. Loctek Ergonomic Technology |
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 CEOs Directory module to screen CEOs from public companies around the world.
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