Correlation Between Changjiang Jinggong and Fushun Special
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By analyzing existing cross correlation between Changjiang Jinggong Steel and Fushun Special Steel, you can compare the effects of market volatilities on Changjiang Jinggong and Fushun Special 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 Changjiang Jinggong with a short position of Fushun Special. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changjiang Jinggong and Fushun Special.
Diversification Opportunities for Changjiang Jinggong and Fushun Special
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Changjiang and Fushun is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Changjiang Jinggong Steel and Fushun Special Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fushun Special Steel and Changjiang Jinggong 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 Changjiang Jinggong Steel are associated (or correlated) with Fushun Special. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fushun Special Steel has no effect on the direction of Changjiang Jinggong i.e., Changjiang Jinggong and Fushun Special go up and down completely randomly.
Pair Corralation between Changjiang Jinggong and Fushun Special
Assuming the 90 days trading horizon Changjiang Jinggong Steel is expected to generate 0.77 times more return on investment than Fushun Special. However, Changjiang Jinggong Steel is 1.31 times less risky than Fushun Special. It trades about 0.04 of its potential returns per unit of risk. Fushun Special Steel is currently generating about -0.23 per unit of risk. If you would invest 295.00 in Changjiang Jinggong Steel on August 27, 2024 and sell it today you would earn a total of 4.00 from holding Changjiang Jinggong Steel or generate 1.36% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changjiang Jinggong Steel vs. Fushun Special Steel
Performance |
| Timeline |
| Changjiang Jinggong Steel |
| Fushun Special Steel |
Changjiang Jinggong and Fushun Special Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changjiang Jinggong and Fushun Special
The main advantage of trading using opposite Changjiang Jinggong and Fushun Special positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changjiang Jinggong position performs unexpectedly, Fushun Special 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 Fushun Special will offset losses from the drop in Fushun Special's long position.| Changjiang Jinggong vs. Cultural Investment Holdings | Changjiang Jinggong vs. China Express Airlines | Changjiang Jinggong vs. Blue Sail Medical | Changjiang Jinggong vs. Xiandai Investment Co |
| Fushun Special vs. Fiberhome Telecommunication Technologies | Fushun Special vs. Beijing HuaYuanYiTong Thermal | Fushun Special vs. Eastern Communications Co | Fushun Special vs. Guocheng Mining 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 Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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