Correlation Between Gansu Jiu and Tianjin Pengling
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By analyzing existing cross correlation between Gansu Jiu Steel and Tianjin Pengling Rubber, you can compare the effects of market volatilities on Gansu Jiu and Tianjin Pengling 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 Tianjin Pengling. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gansu Jiu and Tianjin Pengling.
Diversification Opportunities for Gansu Jiu and Tianjin Pengling
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Gansu and Tianjin is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Gansu Jiu Steel and Tianjin Pengling Rubber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tianjin Pengling Rubber 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 Tianjin Pengling. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tianjin Pengling Rubber has no effect on the direction of Gansu Jiu i.e., Gansu Jiu and Tianjin Pengling go up and down completely randomly.
Pair Corralation between Gansu Jiu and Tianjin Pengling
Assuming the 90 days trading horizon Gansu Jiu Steel is expected to generate 1.01 times more return on investment than Tianjin Pengling. However, Gansu Jiu is 1.01 times more volatile than Tianjin Pengling Rubber. It trades about 0.15 of its potential returns per unit of risk. Tianjin Pengling Rubber is currently generating about 0.0 per unit of risk. If you would invest 179.00 in Gansu Jiu Steel on September 13, 2024 and sell it today you would earn a total of 14.00 from holding Gansu Jiu Steel or generate 7.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gansu Jiu Steel vs. Tianjin Pengling Rubber
Performance |
| Timeline |
| Gansu Jiu Steel |
| Tianjin Pengling Rubber |
Gansu Jiu and Tianjin Pengling Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gansu Jiu and Tianjin Pengling
The main advantage of trading using opposite Gansu Jiu and Tianjin Pengling positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gansu Jiu position performs unexpectedly, Tianjin Pengling 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 Tianjin Pengling will offset losses from the drop in Tianjin Pengling's long position.| Gansu Jiu vs. China Construction Bank | Gansu Jiu vs. Industrial Bank Co | Gansu Jiu vs. Gansu Huangtai Wine marketing | Gansu Jiu vs. Guosheng Financial Holding |
| Tianjin Pengling vs. Chison Medical Technologies | Tianjin Pengling vs. Double Medical Technology | Tianjin Pengling vs. Jinhui Liquor Co | Tianjin Pengling vs. Zhejiang Publishing Media |
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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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