Correlation Between Industrial Securities and Western Metal
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By analyzing existing cross correlation between Industrial Securities Co and Western Metal Materials, you can compare the effects of market volatilities on Industrial Securities and Western Metal 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 Industrial Securities with a short position of Western Metal. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial Securities and Western Metal.
Diversification Opportunities for Industrial Securities and Western Metal
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Industrial and Western is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Industrial Securities Co and Western Metal Materials in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Western Metal Materials and Industrial Securities 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 Industrial Securities Co are associated (or correlated) with Western Metal. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Western Metal Materials has no effect on the direction of Industrial Securities i.e., Industrial Securities and Western Metal go up and down completely randomly.
Pair Corralation between Industrial Securities and Western Metal
Assuming the 90 days trading horizon Industrial Securities is expected to generate 1.15 times less return on investment than Western Metal. But when comparing it to its historical volatility, Industrial Securities Co is 1.29 times less risky than Western Metal. It trades about 0.02 of its potential returns per unit of risk. Western Metal Materials is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 1,615 in Western Metal Materials on September 2, 2024 and sell it today you would earn a total of 1.00 from holding Western Metal Materials or generate 0.06% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial Securities Co vs. Western Metal Materials
Performance |
| Timeline |
| Industrial Securities |
| Western Metal Materials |
Industrial Securities and Western Metal Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial Securities and Western Metal
The main advantage of trading using opposite Industrial Securities and Western Metal positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial Securities position performs unexpectedly, Western Metal 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 Western Metal will offset losses from the drop in Western Metal's long position.| Industrial Securities vs. BeiGene | Industrial Securities vs. Kweichow Moutai Co | Industrial Securities vs. Beijing Roborock Technology | Industrial Securities vs. G bits Network Technology |
| Western Metal vs. Zijin Mining Group | Western Metal vs. Wanhua Chemical Group | Western Metal vs. Baoshan Iron Steel | Western Metal vs. Shandong Gold Mining |
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 Earnings Calls module to check upcoming earnings announcements updated hourly across public exchanges.
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