Correlation Between CITIC Metal and Shandong Ruifeng
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By analyzing existing cross correlation between CITIC Metal Co and Shandong Ruifeng Chemical, you can compare the effects of market volatilities on CITIC Metal and Shandong Ruifeng 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 CITIC Metal with a short position of Shandong Ruifeng. Check out your portfolio center. Please also check ongoing floating volatility patterns of CITIC Metal and Shandong Ruifeng.
Diversification Opportunities for CITIC Metal and Shandong Ruifeng
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between CITIC and Shandong is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding CITIC Metal Co and Shandong Ruifeng Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shandong Ruifeng Chemical and CITIC Metal 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 CITIC Metal Co are associated (or correlated) with Shandong Ruifeng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shandong Ruifeng Chemical has no effect on the direction of CITIC Metal i.e., CITIC Metal and Shandong Ruifeng go up and down completely randomly.
Pair Corralation between CITIC Metal and Shandong Ruifeng
Assuming the 90 days trading horizon CITIC Metal Co is expected to generate 0.36 times more return on investment than Shandong Ruifeng. However, CITIC Metal Co is 2.8 times less risky than Shandong Ruifeng. It trades about -0.25 of its potential returns per unit of risk. Shandong Ruifeng Chemical is currently generating about -0.18 per unit of risk. If you would invest 842.00 in CITIC Metal Co on September 12, 2024 and sell it today you would lose (56.00) from holding CITIC Metal Co or give up 6.65% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
CITIC Metal Co vs. Shandong Ruifeng Chemical
Performance |
| Timeline |
| CITIC Metal |
| Shandong Ruifeng Chemical |
CITIC Metal and Shandong Ruifeng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with CITIC Metal and Shandong Ruifeng
The main advantage of trading using opposite CITIC Metal and Shandong Ruifeng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if CITIC Metal position performs unexpectedly, Shandong Ruifeng 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 Shandong Ruifeng will offset losses from the drop in Shandong Ruifeng's long position.| CITIC Metal vs. Zijin Mining Group | CITIC Metal vs. Wanhua Chemical Group | CITIC Metal vs. Baoshan Iron Steel | CITIC Metal vs. Rongsheng Petrochemical Co |
| Shandong Ruifeng vs. Zijin Mining Group | Shandong Ruifeng vs. Wanhua Chemical Group | Shandong Ruifeng vs. Baoshan Iron Steel | Shandong Ruifeng 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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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