Correlation Between China Aluminum and Shenzhen Kexin
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By analyzing existing cross correlation between China Aluminum International and Shenzhen Kexin Communication, you can compare the effects of market volatilities on China Aluminum and Shenzhen Kexin 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 Shenzhen Kexin. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Aluminum and Shenzhen Kexin.
Diversification Opportunities for China Aluminum and Shenzhen Kexin
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Shenzhen is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding China Aluminum International and Shenzhen Kexin Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shenzhen Kexin Commu 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 Shenzhen Kexin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shenzhen Kexin Commu has no effect on the direction of China Aluminum i.e., China Aluminum and Shenzhen Kexin go up and down completely randomly.
Pair Corralation between China Aluminum and Shenzhen Kexin
Assuming the 90 days trading horizon China Aluminum International is expected to generate 0.56 times more return on investment than Shenzhen Kexin. However, China Aluminum International is 1.77 times less risky than Shenzhen Kexin. It trades about -0.01 of its potential returns per unit of risk. Shenzhen Kexin Communication is currently generating about -0.2 per unit of risk. If you would invest 474.00 in China Aluminum International on August 25, 2024 and sell it today you would lose (4.00) from holding China Aluminum International or give up 0.84% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Aluminum International vs. Shenzhen Kexin Communication
Performance |
| Timeline |
| China Aluminum Inter |
| Shenzhen Kexin Commu |
China Aluminum and Shenzhen Kexin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Aluminum and Shenzhen Kexin
The main advantage of trading using opposite China Aluminum and Shenzhen Kexin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Aluminum position performs unexpectedly, Shenzhen Kexin 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 Shenzhen Kexin will offset losses from the drop in Shenzhen Kexin's long position.| China Aluminum vs. Chengdu Kanghua Biological | China Aluminum vs. Beijing Wantai Biological | China Aluminum vs. Suzhou Novoprotein Scientific | China Aluminum vs. Aluminum Corp of |
| Shenzhen Kexin vs. Ming Yang Smart | Shenzhen Kexin vs. 159005 | Shenzhen Kexin vs. Loctek Ergonomic Technology | Shenzhen Kexin vs. Xiamen East Asia |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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