Correlation Between Changjiang Jinggong and Hang Xiao
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By analyzing existing cross correlation between Changjiang Jinggong Steel and Hang Xiao Steel, you can compare the effects of market volatilities on Changjiang Jinggong and Hang Xiao 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 Hang Xiao. Check out your portfolio center. Please also check ongoing floating volatility patterns of Changjiang Jinggong and Hang Xiao.
Diversification Opportunities for Changjiang Jinggong and Hang Xiao
0.97 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Changjiang and Hang is 0.97. Overlapping area represents the amount of risk that can be diversified away by holding Changjiang Jinggong Steel and Hang Xiao Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hang Xiao 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 Hang Xiao. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hang Xiao Steel has no effect on the direction of Changjiang Jinggong i.e., Changjiang Jinggong and Hang Xiao go up and down completely randomly.
Pair Corralation between Changjiang Jinggong and Hang Xiao
Assuming the 90 days trading horizon Changjiang Jinggong Steel is expected to generate 0.73 times more return on investment than Hang Xiao. However, Changjiang Jinggong Steel is 1.38 times less risky than Hang Xiao. It trades about -0.03 of its potential returns per unit of risk. Hang Xiao Steel is currently generating about -0.04 per unit of risk. If you would invest 410.00 in Changjiang Jinggong Steel on August 30, 2024 and sell it today you would lose (106.00) from holding Changjiang Jinggong Steel or give up 25.85% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Changjiang Jinggong Steel vs. Hang Xiao Steel
Performance |
| Timeline |
| Changjiang Jinggong Steel |
| Hang Xiao Steel |
Changjiang Jinggong and Hang Xiao Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Changjiang Jinggong and Hang Xiao
The main advantage of trading using opposite Changjiang Jinggong and Hang Xiao positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Changjiang Jinggong position performs unexpectedly, Hang Xiao 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 Hang Xiao will offset losses from the drop in Hang Xiao's long position.| Changjiang Jinggong vs. Lander Sports Development | Changjiang Jinggong vs. Shanghai CEO Environmental | Changjiang Jinggong vs. Cicc Fund Management | Changjiang Jinggong vs. Chengdu B ray Media |
| Hang Xiao vs. PetroChina Co Ltd | Hang Xiao vs. China State Construction | Hang Xiao vs. China Mobile Limited | Hang Xiao vs. Industrial and Commercial |
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 Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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