Correlation Between Beijing Wantai and Wangneng Environment
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By analyzing existing cross correlation between Beijing Wantai Biological and Wangneng Environment Co, you can compare the effects of market volatilities on Beijing Wantai and Wangneng Environment 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 Beijing Wantai with a short position of Wangneng Environment. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Wantai and Wangneng Environment.
Diversification Opportunities for Beijing Wantai and Wangneng Environment
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Beijing and Wangneng is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Wantai Biological and Wangneng Environment Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Wangneng Environment and Beijing Wantai 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 Beijing Wantai Biological are associated (or correlated) with Wangneng Environment. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Wangneng Environment has no effect on the direction of Beijing Wantai i.e., Beijing Wantai and Wangneng Environment go up and down completely randomly.
Pair Corralation between Beijing Wantai and Wangneng Environment
Assuming the 90 days trading horizon Beijing Wantai Biological is expected to under-perform the Wangneng Environment. In addition to that, Beijing Wantai is 1.04 times more volatile than Wangneng Environment Co. It trades about -0.14 of its total potential returns per unit of risk. Wangneng Environment Co is currently generating about 0.0 per unit of volatility. If you would invest 1,559 in Wangneng Environment Co on August 31, 2024 and sell it today you would lose (18.00) from holding Wangneng Environment Co or give up 1.15% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Wantai Biological vs. Wangneng Environment Co
Performance |
| Timeline |
| Beijing Wantai Biological |
| Wangneng Environment |
Beijing Wantai and Wangneng Environment Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Wantai and Wangneng Environment
The main advantage of trading using opposite Beijing Wantai and Wangneng Environment positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Wantai position performs unexpectedly, Wangneng Environment 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 Wangneng Environment will offset losses from the drop in Wangneng Environment's long position.| Beijing Wantai vs. Easyhome New Retail | Beijing Wantai vs. Shenzhen Noposion Agrochemicals | Beijing Wantai vs. Wuxi Chemical Equipment | Beijing Wantai vs. HeBei Jinniu Chemical |
| Wangneng Environment vs. China State Construction | Wangneng Environment vs. China Merchants Shekou | Wangneng Environment vs. Huafa Industrial Co | Wangneng Environment vs. China International Capital |
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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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