Correlation Between Beijing Bashi and Gansu Jiu
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By analyzing existing cross correlation between Beijing Bashi Media and Gansu Jiu Steel, you can compare the effects of market volatilities on Beijing Bashi and Gansu Jiu 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 Beijing Bashi with a short position of Gansu Jiu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Bashi and Gansu Jiu.
Diversification Opportunities for Beijing Bashi and Gansu Jiu
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Beijing and Gansu is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Bashi Media and Gansu Jiu Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gansu Jiu Steel and Beijing Bashi 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 Beijing Bashi Media are associated (or correlated) with Gansu Jiu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gansu Jiu Steel has no effect on the direction of Beijing Bashi i.e., Beijing Bashi and Gansu Jiu go up and down completely randomly.
Pair Corralation between Beijing Bashi and Gansu Jiu
Assuming the 90 days trading horizon Beijing Bashi Media is expected to generate 1.61 times more return on investment than Gansu Jiu. However, Beijing Bashi is 1.61 times more volatile than Gansu Jiu Steel. It trades about 0.19 of its potential returns per unit of risk. Gansu Jiu Steel is currently generating about 0.1 per unit of risk. If you would invest 438.00 in Beijing Bashi Media on September 13, 2024 and sell it today you would earn a total of 74.00 from holding Beijing Bashi Media or generate 16.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Bashi Media vs. Gansu Jiu Steel
Performance |
| Timeline |
| Beijing Bashi Media |
| Gansu Jiu Steel |
Beijing Bashi and Gansu Jiu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Bashi and Gansu Jiu
The main advantage of trading using opposite Beijing Bashi and Gansu Jiu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Bashi position performs unexpectedly, Gansu Jiu 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 Gansu Jiu will offset losses from the drop in Gansu Jiu's long position.| Beijing Bashi vs. Ming Yang Smart | Beijing Bashi vs. 159681 | Beijing Bashi vs. 159005 | Beijing Bashi vs. Loctek Ergonomic Technology |
| Gansu Jiu vs. Zijin Mining Group | Gansu Jiu vs. Wanhua Chemical Group | Gansu Jiu vs. Baoshan Iron Steel | Gansu Jiu vs. Shandong Gold Mining |
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 Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.
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