Correlation Between Pengxin International and ADAMA
Specify exactly 2 symbols:
By analyzing existing cross correlation between Pengxin International Mining and ADAMA, you can compare the effects of market volatilities on Pengxin International and ADAMA 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 Pengxin International with a short position of ADAMA. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pengxin International and ADAMA.
Diversification Opportunities for Pengxin International and ADAMA
0.85 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Pengxin and ADAMA is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Pengxin International Mining and ADAMA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on ADAMA and Pengxin International 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 Pengxin International Mining are associated (or correlated) with ADAMA. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of ADAMA has no effect on the direction of Pengxin International i.e., Pengxin International and ADAMA go up and down completely randomly.
Pair Corralation between Pengxin International and ADAMA
Assuming the 90 days trading horizon Pengxin International Mining is expected to generate 1.26 times more return on investment than ADAMA. However, Pengxin International is 1.26 times more volatile than ADAMA. It trades about -0.02 of its potential returns per unit of risk. ADAMA is currently generating about -0.25 per unit of risk. If you would invest 320.00 in Pengxin International Mining on August 31, 2024 and sell it today you would lose (7.00) from holding Pengxin International Mining or give up 2.19% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Pengxin International Mining vs. ADAMA
Performance |
| Timeline |
| Pengxin International |
| ADAMA |
Pengxin International and ADAMA Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pengxin International and ADAMA
The main advantage of trading using opposite Pengxin International and ADAMA positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pengxin International position performs unexpectedly, ADAMA 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 ADAMA will offset losses from the drop in ADAMA's long position.The idea behind Pengxin International Mining and ADAMA pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| ADAMA vs. Pengxin International Mining | ADAMA vs. Xiangyu Medical Co | ADAMA vs. Qingdao Haier Biomedical | ADAMA vs. Jiangxi Naipu 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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
Other Complementary Tools
| Share Portfolio Track or share privately all of your investments from the convenience of any device | |
| Sectors List of equity sectors categorizing publicly traded companies based on their primary business activities | |
| Fundamentals Comparison Compare fundamentals across multiple equities to find investing opportunities | |
| Cryptocurrency Center Build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency | |
| Balance Of Power Check stock momentum by analyzing Balance Of Power indicator and other technical ratios |