Correlation Between China Aluminum and Xian Sunresin
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By analyzing existing cross correlation between China Aluminum International and Xian Sunresin New, you can compare the effects of market volatilities on China Aluminum and Xian Sunresin 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 China Aluminum with a short position of Xian Sunresin. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Aluminum and Xian Sunresin.
Diversification Opportunities for China Aluminum and Xian Sunresin
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between China and Xian is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding China Aluminum International and Xian Sunresin New in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xian Sunresin New and China Aluminum 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 China Aluminum International are associated (or correlated) with Xian Sunresin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xian Sunresin New has no effect on the direction of China Aluminum i.e., China Aluminum and Xian Sunresin go up and down completely randomly.
Pair Corralation between China Aluminum and Xian Sunresin
Assuming the 90 days trading horizon China Aluminum is expected to generate 3.71 times less return on investment than Xian Sunresin. But when comparing it to its historical volatility, China Aluminum International is 1.11 times less risky than Xian Sunresin. It trades about 0.01 of its potential returns per unit of risk. Xian Sunresin New is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 4,828 in Xian Sunresin New on September 3, 2024 and sell it today you would earn a total of 699.00 from holding Xian Sunresin New or generate 14.48% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Aluminum International vs. Xian Sunresin New
Performance |
| Timeline |
| China Aluminum Inter |
| Xian Sunresin New |
China Aluminum and Xian Sunresin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Aluminum and Xian Sunresin
The main advantage of trading using opposite China Aluminum and Xian Sunresin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Aluminum position performs unexpectedly, Xian Sunresin 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 Xian Sunresin will offset losses from the drop in Xian Sunresin's long position.| China Aluminum vs. Cultural Investment Holdings | China Aluminum vs. Gome Telecom Equipment | China Aluminum vs. Bus Online Co | China Aluminum vs. Holitech Technology Co |
| Xian Sunresin vs. Zijin Mining Group | Xian Sunresin vs. Guocheng Mining Co | Xian Sunresin vs. Zhengzhou Qianweiyangchu Food | Xian Sunresin vs. Tianjin Silvery Dragon |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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