Correlation Between Gansu Jiu and Chengdu B
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By analyzing existing cross correlation between Gansu Jiu Steel and Chengdu B ray Media, you can compare the effects of market volatilities on Gansu Jiu and Chengdu B 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 Chengdu B. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gansu Jiu and Chengdu B.
Diversification Opportunities for Gansu Jiu and Chengdu B
Very poor diversification
The 3 months correlation between Gansu and Chengdu is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Gansu Jiu Steel and Chengdu B ray Media in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chengdu B ray 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 Chengdu B. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chengdu B ray has no effect on the direction of Gansu Jiu i.e., Gansu Jiu and Chengdu B go up and down completely randomly.
Pair Corralation between Gansu Jiu and Chengdu B
Assuming the 90 days trading horizon Gansu Jiu Steel is expected to under-perform the Chengdu B. In addition to that, Gansu Jiu is 1.01 times more volatile than Chengdu B ray Media. It trades about -0.09 of its total potential returns per unit of risk. Chengdu B ray Media is currently generating about 0.2 per unit of volatility. If you would invest 448.00 in Chengdu B ray Media on September 3, 2024 and sell it today you would earn a total of 49.00 from holding Chengdu B ray Media or generate 10.94% 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. Chengdu B ray Media
Performance |
| Timeline |
| Gansu Jiu Steel |
| Chengdu B ray |
Gansu Jiu and Chengdu B Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gansu Jiu and Chengdu B
The main advantage of trading using opposite Gansu Jiu and Chengdu B positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gansu Jiu position performs unexpectedly, Chengdu B 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 Chengdu B will offset losses from the drop in Chengdu B'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 |
| Chengdu B vs. Gansu Jiu Steel | Chengdu B vs. Ming Yang Smart | Chengdu B vs. Aba Chemicals Corp | Chengdu B 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 Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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