Correlation Between Dawning Information and Gansu Jiu
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By analyzing existing cross correlation between Dawning Information Industry and Gansu Jiu Steel, you can compare the effects of market volatilities on Dawning Information and Gansu Jiu 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 Dawning Information with a short position of Gansu Jiu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dawning Information and Gansu Jiu.
Diversification Opportunities for Dawning Information and Gansu Jiu
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Dawning and Gansu is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Dawning Information Industry and Gansu Jiu Steel in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Gansu Jiu Steel and Dawning Information 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 Dawning Information Industry are associated (or correlated) with Gansu Jiu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Gansu Jiu Steel has no effect on the direction of Dawning Information i.e., Dawning Information and Gansu Jiu go up and down completely randomly.
Pair Corralation between Dawning Information and Gansu Jiu
Assuming the 90 days trading horizon Dawning Information Industry is expected to generate 1.09 times more return on investment than Gansu Jiu. However, Dawning Information is 1.09 times more volatile than Gansu Jiu Steel. It trades about 0.2 of its potential returns per unit of risk. Gansu Jiu Steel is currently generating about 0.2 per unit of risk. If you would invest 5,200 in Dawning Information Industry on September 13, 2024 and sell it today you would earn a total of 2,172 from holding Dawning Information Industry or generate 41.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Dawning Information Industry vs. Gansu Jiu Steel
Performance |
| Timeline |
| Dawning Information |
| Gansu Jiu Steel |
Dawning Information and Gansu Jiu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dawning Information and Gansu Jiu
The main advantage of trading using opposite Dawning Information and Gansu Jiu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dawning Information position performs unexpectedly, Gansu Jiu 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 Gansu Jiu will offset losses from the drop in Gansu Jiu's long position.| Dawning Information vs. Dhc Software Co | Dawning Information vs. ChengDu Hi Tech Development | Dawning Information vs. Sinofibers Technology Co | Dawning Information vs. Qingdao Hi Tech Moulds |
| Gansu Jiu vs. China Construction Bank | Gansu Jiu vs. Industrial Bank Co | Gansu Jiu vs. Gansu Huangtai Wine marketing | Gansu Jiu vs. Guosheng Financial Holding |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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