Correlation Between Wanhua Chemical and Miracll Chemicals
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By analyzing existing cross correlation between Wanhua Chemical Group and Miracll Chemicals Co, you can compare the effects of market volatilities on Wanhua Chemical and Miracll Chemicals 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 Wanhua Chemical with a short position of Miracll Chemicals. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wanhua Chemical and Miracll Chemicals.
Diversification Opportunities for Wanhua Chemical and Miracll Chemicals
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Wanhua and Miracll is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Wanhua Chemical Group and Miracll Chemicals Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Miracll Chemicals and Wanhua Chemical 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 Wanhua Chemical Group are associated (or correlated) with Miracll Chemicals. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Miracll Chemicals has no effect on the direction of Wanhua Chemical i.e., Wanhua Chemical and Miracll Chemicals go up and down completely randomly.
Pair Corralation between Wanhua Chemical and Miracll Chemicals
Assuming the 90 days trading horizon Wanhua Chemical Group is expected to under-perform the Miracll Chemicals. But the stock apears to be less risky and, when comparing its historical volatility, Wanhua Chemical Group is 2.96 times less risky than Miracll Chemicals. The stock trades about -0.23 of its potential returns per unit of risk. The Miracll Chemicals Co is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 1,656 in Miracll Chemicals Co on August 28, 2024 and sell it today you would earn a total of 182.00 from holding Miracll Chemicals Co or generate 10.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wanhua Chemical Group vs. Miracll Chemicals Co
Performance |
| Timeline |
| Wanhua Chemical Group |
| Miracll Chemicals |
Wanhua Chemical and Miracll Chemicals Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wanhua Chemical and Miracll Chemicals
The main advantage of trading using opposite Wanhua Chemical and Miracll Chemicals positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wanhua Chemical position performs unexpectedly, Miracll Chemicals 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 Miracll Chemicals will offset losses from the drop in Miracll Chemicals' long position.| Wanhua Chemical vs. Chongqing Changan Automobile | Wanhua Chemical vs. Guangdong Shenglu Telecommunication | Wanhua Chemical vs. Tongyu Communication | Wanhua Chemical vs. Sinomach Automobile Co |
| Miracll Chemicals vs. Zijin Mining Group | Miracll Chemicals vs. Baoshan Iron Steel | Miracll Chemicals vs. Shandong Gold Mining | Miracll Chemicals vs. Rongsheng Petrochemical Co |
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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