Correlation Between Gansu Jiu and Shenzhen Kexin
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By analyzing existing cross correlation between Gansu Jiu Steel and Shenzhen Kexin Communication, you can compare the effects of market volatilities on Gansu Jiu and Shenzhen Kexin 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 Shenzhen Kexin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gansu Jiu and Shenzhen Kexin.
Diversification Opportunities for Gansu Jiu and Shenzhen Kexin
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Gansu and Shenzhen is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Gansu Jiu Steel and Shenzhen Kexin Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Kexin Commu 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 Shenzhen Kexin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Kexin Commu has no effect on the direction of Gansu Jiu i.e., Gansu Jiu and Shenzhen Kexin go up and down completely randomly.
Pair Corralation between Gansu Jiu and Shenzhen Kexin
Assuming the 90 days trading horizon Gansu Jiu Steel is expected to generate 0.59 times more return on investment than Shenzhen Kexin. However, Gansu Jiu Steel is 1.69 times less risky than Shenzhen Kexin. It trades about 0.04 of its potential returns per unit of risk. Shenzhen Kexin Communication is currently generating about 0.02 per unit of risk. If you would invest 154.00 in Gansu Jiu Steel on September 12, 2024 and sell it today you would earn a total of 31.00 from holding Gansu Jiu Steel or generate 20.13% 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. Shenzhen Kexin Communication
Performance |
| Timeline |
| Gansu Jiu Steel |
| Shenzhen Kexin Commu |
Gansu Jiu and Shenzhen Kexin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gansu Jiu and Shenzhen Kexin
The main advantage of trading using opposite Gansu Jiu and Shenzhen Kexin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gansu Jiu position performs unexpectedly, Shenzhen Kexin 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 Shenzhen Kexin will offset losses from the drop in Shenzhen Kexin's long position.| Gansu Jiu vs. Zijin Mining Group | Gansu Jiu vs. Wanhua Chemical Group | Gansu Jiu vs. Baoshan Iron Steel | Gansu Jiu vs. Rongsheng Petrochemical Co |
| Shenzhen Kexin vs. Gansu Jiu Steel | Shenzhen Kexin vs. Shandong Mining Machinery | Shenzhen Kexin vs. Aba Chemicals Corp | Shenzhen Kexin vs. BlueFocus Communication Group |
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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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