Correlation Between Industrial and Beijing Watertek
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By analyzing existing cross correlation between Industrial and Commercial and Beijing Watertek Information, you can compare the effects of market volatilities on Industrial and Beijing Watertek 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 with a short position of Beijing Watertek. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial and Beijing Watertek.
Diversification Opportunities for Industrial and Beijing Watertek
-0.51 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Industrial and Beijing is -0.51. Overlapping area represents the amount of risk that can be diversified away by holding Industrial and Commercial and Beijing Watertek Information in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Watertek Inf and Industrial 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 and Commercial are associated (or correlated) with Beijing Watertek. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Watertek Inf has no effect on the direction of Industrial i.e., Industrial and Beijing Watertek go up and down completely randomly.
Pair Corralation between Industrial and Beijing Watertek
Assuming the 90 days trading horizon Industrial is expected to generate 3.33 times less return on investment than Beijing Watertek. But when comparing it to its historical volatility, Industrial and Commercial is 3.94 times less risky than Beijing Watertek. It trades about 0.14 of its potential returns per unit of risk. Beijing Watertek Information is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 216.00 in Beijing Watertek Information on October 18, 2024 and sell it today you would earn a total of 110.00 from holding Beijing Watertek Information or generate 50.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial and Commercial vs. Beijing Watertek Information
Performance |
| Timeline |
| Industrial and Commercial |
| Beijing Watertek Inf |
Industrial and Beijing Watertek Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial and Beijing Watertek
The main advantage of trading using opposite Industrial and Beijing Watertek positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial position performs unexpectedly, Beijing Watertek 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 Beijing Watertek will offset losses from the drop in Beijing Watertek's long position.| Industrial vs. Hengli Industrial Development | Industrial vs. Sichuan Jinshi Technology | Industrial vs. Anhui Jinhe Industrial | Industrial vs. Xinjiang Baodi Mining |
| Beijing Watertek vs. Invengo Information Technology | Beijing Watertek vs. HaiXin Foods Co | Beijing Watertek vs. AVCON Information Tech | Beijing Watertek vs. Fujian Anjoy Foods |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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