Correlation Between Anyang Iron and Guangdong Liantai
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By analyzing existing cross correlation between Anyang Iron Steel and Guangdong Liantai Environmental, you can compare the effects of market volatilities on Anyang Iron and Guangdong Liantai 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 Guangdong Liantai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anyang Iron and Guangdong Liantai.
Diversification Opportunities for Anyang Iron and Guangdong Liantai
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Anyang and Guangdong is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Anyang Iron Steel and Guangdong Liantai Environmenta in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangdong Liantai 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 Guangdong Liantai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangdong Liantai has no effect on the direction of Anyang Iron i.e., Anyang Iron and Guangdong Liantai go up and down completely randomly.
Pair Corralation between Anyang Iron and Guangdong Liantai
Assuming the 90 days trading horizon Anyang Iron Steel is expected to under-perform the Guangdong Liantai. In addition to that, Anyang Iron is 1.55 times more volatile than Guangdong Liantai Environmental. It trades about -0.11 of its total potential returns per unit of risk. Guangdong Liantai Environmental is currently generating about 0.19 per unit of volatility. If you would invest 393.00 in Guangdong Liantai Environmental on September 1, 2024 and sell it today you would earn a total of 37.00 from holding Guangdong Liantai Environmental or generate 9.41% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anyang Iron Steel vs. Guangdong Liantai Environmenta
Performance |
| Timeline |
| Anyang Iron Steel |
| Guangdong Liantai |
Anyang Iron and Guangdong Liantai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anyang Iron and Guangdong Liantai
The main advantage of trading using opposite Anyang Iron and Guangdong Liantai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anyang Iron position performs unexpectedly, Guangdong Liantai 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 Guangdong Liantai will offset losses from the drop in Guangdong Liantai'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 USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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