Correlation Between Aluminum Corp and Wenzhou Hongfeng
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By analyzing existing cross correlation between Aluminum Corp of and Wenzhou Hongfeng Electrical, you can compare the effects of market volatilities on Aluminum Corp and Wenzhou Hongfeng 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 Aluminum Corp with a short position of Wenzhou Hongfeng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aluminum Corp and Wenzhou Hongfeng.
Diversification Opportunities for Aluminum Corp and Wenzhou Hongfeng
0.45 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Aluminum and Wenzhou is 0.45. Overlapping area represents the amount of risk that can be diversified away by holding Aluminum Corp of and Wenzhou Hongfeng Electrical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wenzhou Hongfeng Ele and Aluminum Corp 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 Aluminum Corp of are associated (or correlated) with Wenzhou Hongfeng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wenzhou Hongfeng Ele has no effect on the direction of Aluminum Corp i.e., Aluminum Corp and Wenzhou Hongfeng go up and down completely randomly.
Pair Corralation between Aluminum Corp and Wenzhou Hongfeng
Assuming the 90 days trading horizon Aluminum Corp of is expected to generate 0.68 times more return on investment than Wenzhou Hongfeng. However, Aluminum Corp of is 1.47 times less risky than Wenzhou Hongfeng. It trades about 0.05 of its potential returns per unit of risk. Wenzhou Hongfeng Electrical is currently generating about 0.03 per unit of risk. If you would invest 586.00 in Aluminum Corp of on September 12, 2024 and sell it today you would earn a total of 181.00 from holding Aluminum Corp of or generate 30.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.68% |
| Values | Daily Returns |
Aluminum Corp of vs. Wenzhou Hongfeng Electrical
Performance |
| Timeline |
| Aluminum Corp |
| Wenzhou Hongfeng Ele |
Aluminum Corp and Wenzhou Hongfeng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aluminum Corp and Wenzhou Hongfeng
The main advantage of trading using opposite Aluminum Corp and Wenzhou Hongfeng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aluminum Corp position performs unexpectedly, Wenzhou Hongfeng 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 Wenzhou Hongfeng will offset losses from the drop in Wenzhou Hongfeng's long position.| Aluminum Corp vs. Zijin Mining Group | Aluminum Corp vs. Wanhua Chemical Group | Aluminum Corp vs. Baoshan Iron Steel | Aluminum Corp vs. Rongsheng Petrochemical Co |
| Wenzhou Hongfeng vs. YLZ Information Tech | Wenzhou Hongfeng vs. Xiamen Goldenhome Co | Wenzhou Hongfeng vs. ButOne Information Corp | Wenzhou Hongfeng vs. Nanxing Furniture Machinery |
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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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