Correlation Between Datang HuaYin and Gansu Jiu
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By analyzing existing cross correlation between Datang HuaYin Electric and Gansu Jiu Steel, you can compare the effects of market volatilities on Datang HuaYin and Gansu Jiu 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 Datang HuaYin with a short position of Gansu Jiu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Datang HuaYin and Gansu Jiu.
Diversification Opportunities for Datang HuaYin and Gansu Jiu
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Datang and Gansu is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Datang HuaYin Electric and Gansu Jiu Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gansu Jiu Steel and Datang HuaYin 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 Datang HuaYin Electric are associated (or correlated) with Gansu Jiu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gansu Jiu Steel has no effect on the direction of Datang HuaYin i.e., Datang HuaYin and Gansu Jiu go up and down completely randomly.
Pair Corralation between Datang HuaYin and Gansu Jiu
Assuming the 90 days trading horizon Datang HuaYin is expected to generate 1.11 times less return on investment than Gansu Jiu. In addition to that, Datang HuaYin is 1.32 times more volatile than Gansu Jiu Steel. It trades about 0.02 of its total potential returns per unit of risk. Gansu Jiu Steel is currently generating about 0.03 per unit of volatility. If you would invest 164.00 in Gansu Jiu Steel on September 12, 2024 and sell it today you would earn a total of 21.00 from holding Gansu Jiu Steel or generate 12.8% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Datang HuaYin Electric vs. Gansu Jiu Steel
Performance |
| Timeline |
| Datang HuaYin Electric |
| Gansu Jiu Steel |
Datang HuaYin and Gansu Jiu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Datang HuaYin and Gansu Jiu
The main advantage of trading using opposite Datang HuaYin and Gansu Jiu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Datang HuaYin position performs unexpectedly, Gansu Jiu 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 Gansu Jiu will offset losses from the drop in Gansu Jiu's long position.| Datang HuaYin vs. Gansu Jiu Steel | Datang HuaYin vs. Shandong Mining Machinery | Datang HuaYin vs. Aba Chemicals Corp | Datang HuaYin vs. BlueFocus Communication Group |
| Gansu Jiu vs. Zijin Mining Group | Gansu Jiu vs. Wanhua Chemical Group | Gansu Jiu vs. Baoshan Iron Steel | Gansu Jiu vs. Rongsheng Petrochemical 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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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