Correlation Between Industrial and Industrial Securities
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By analyzing existing cross correlation between Industrial and Commercial and Industrial Securities Co, you can compare the effects of market volatilities on Industrial and Industrial Securities 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 Industrial Securities. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial and Industrial Securities.
Diversification Opportunities for Industrial and Industrial Securities
-0.59 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Industrial and Industrial is -0.59. Overlapping area represents the amount of risk that can be diversified away by holding Industrial and Commercial and Industrial Securities Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Industrial Securities 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 Industrial Securities. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Industrial Securities has no effect on the direction of Industrial i.e., Industrial and Industrial Securities go up and down completely randomly.
Pair Corralation between Industrial and Industrial Securities
Assuming the 90 days trading horizon Industrial and Commercial is expected to generate 0.75 times more return on investment than Industrial Securities. However, Industrial and Commercial is 1.33 times less risky than Industrial Securities. It trades about -0.19 of its potential returns per unit of risk. Industrial Securities Co is currently generating about -0.19 per unit of risk. If you would invest 678.00 in Industrial and Commercial on October 25, 2024 and sell it today you would lose (34.00) from holding Industrial and Commercial or give up 5.01% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial and Commercial vs. Industrial Securities Co
Performance |
| Timeline |
| Industrial and Commercial |
| Industrial Securities |
Industrial and Industrial Securities Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial and Industrial Securities
The main advantage of trading using opposite Industrial and Industrial Securities positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial position performs unexpectedly, Industrial Securities 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 Industrial Securities will offset losses from the drop in Industrial Securities' long position.| Industrial vs. Touchstone International Medical | Industrial vs. Dazhong Transportation Group | Industrial vs. Shenzhen Topway Video | Industrial vs. Allgens Medical Technology |
| Industrial Securities vs. Bank of China | Industrial Securities vs. Kweichow Moutai Co | Industrial Securities vs. PetroChina Co Ltd | Industrial Securities vs. Bank of Communications |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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