Correlation Between Anyang Iron and Dongjiang Environmental
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By analyzing existing cross correlation between Anyang Iron Steel and Dongjiang Environmental Co, you can compare the effects of market volatilities on Anyang Iron and Dongjiang Environmental 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 Anyang Iron with a short position of Dongjiang Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anyang Iron and Dongjiang Environmental.
Diversification Opportunities for Anyang Iron and Dongjiang Environmental
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Anyang and Dongjiang is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Anyang Iron Steel and Dongjiang Environmental Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongjiang Environmental and Anyang Iron 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 Anyang Iron Steel are associated (or correlated) with Dongjiang Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongjiang Environmental has no effect on the direction of Anyang Iron i.e., Anyang Iron and Dongjiang Environmental go up and down completely randomly.
Pair Corralation between Anyang Iron and Dongjiang Environmental
Assuming the 90 days trading horizon Anyang Iron Steel is expected to under-perform the Dongjiang Environmental. In addition to that, Anyang Iron is 1.63 times more volatile than Dongjiang Environmental Co. It trades about -0.11 of its total potential returns per unit of risk. Dongjiang Environmental Co is currently generating about -0.1 per unit of volatility. If you would invest 515.00 in Dongjiang Environmental Co on September 1, 2024 and sell it today you would lose (27.00) from holding Dongjiang Environmental Co or give up 5.24% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anyang Iron Steel vs. Dongjiang Environmental Co
Performance |
| Timeline |
| Anyang Iron Steel |
| Dongjiang Environmental |
Anyang Iron and Dongjiang Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anyang Iron and Dongjiang Environmental
The main advantage of trading using opposite Anyang Iron and Dongjiang Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anyang Iron position performs unexpectedly, Dongjiang Environmental 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 Dongjiang Environmental will offset losses from the drop in Dongjiang Environmental's long position.| Anyang Iron vs. Zijin Mining Group | Anyang Iron vs. Wanhua Chemical Group | Anyang Iron vs. Baoshan Iron Steel | Anyang Iron 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 Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.
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