Correlation Between China Aluminum and Kangping Technology
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By analyzing existing cross correlation between China Aluminum International and Kangping Technology Co, you can compare the effects of market volatilities on China Aluminum and Kangping Technology 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 Kangping Technology. Check out your portfolio center. Please also check ongoing floating volatility patterns of China Aluminum and Kangping Technology.
Diversification Opportunities for China Aluminum and Kangping Technology
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between China and Kangping is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding China Aluminum International and Kangping Technology Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kangping Technology 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 Kangping Technology. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kangping Technology has no effect on the direction of China Aluminum i.e., China Aluminum and Kangping Technology go up and down completely randomly.
Pair Corralation between China Aluminum and Kangping Technology
Assuming the 90 days trading horizon China Aluminum International is expected to under-perform the Kangping Technology. But the stock apears to be less risky and, when comparing its historical volatility, China Aluminum International is 1.33 times less risky than Kangping Technology. The stock trades about -0.13 of its potential returns per unit of risk. The Kangping Technology Co is currently generating about 0.15 of returns per unit of risk over similar time horizon. If you would invest 2,197 in Kangping Technology Co on August 29, 2024 and sell it today you would earn a total of 151.00 from holding Kangping Technology Co or generate 6.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
China Aluminum International vs. Kangping Technology Co
Performance |
| Timeline |
| China Aluminum Inter |
| Kangping Technology |
China Aluminum and Kangping Technology Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with China Aluminum and Kangping Technology
The main advantage of trading using opposite China Aluminum and Kangping Technology positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if China Aluminum position performs unexpectedly, Kangping Technology 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 Kangping Technology will offset losses from the drop in Kangping Technology's long position.| China Aluminum vs. Ming Yang Smart | China Aluminum vs. 159681 | China Aluminum vs. 159005 | China Aluminum vs. Loctek Ergonomic Technology |
| Kangping Technology vs. Kweichow Moutai Co | Kangping Technology vs. Shenzhen Mindray Bio Medical | Kangping Technology vs. Jiangsu Pacific Quartz | Kangping Technology vs. G bits Network Technology |
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 Pair Correlation module to compare performance and examine fundamental relationship between any two equity instruments.
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