Correlation Between Beijing Wantai and Aluminum Corp
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By analyzing existing cross correlation between Beijing Wantai Biological and Aluminum Corp of, you can compare the effects of market volatilities on Beijing Wantai and Aluminum Corp 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 Aluminum Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Wantai and Aluminum Corp.
Diversification Opportunities for Beijing Wantai and Aluminum Corp
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Beijing and Aluminum is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Wantai Biological and Aluminum Corp of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aluminum Corp 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 Aluminum Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aluminum Corp has no effect on the direction of Beijing Wantai i.e., Beijing Wantai and Aluminum Corp go up and down completely randomly.
Pair Corralation between Beijing Wantai and Aluminum Corp
Assuming the 90 days trading horizon Beijing Wantai is expected to generate 2.75 times less return on investment than Aluminum Corp. But when comparing it to its historical volatility, Beijing Wantai Biological is 1.36 times less risky than Aluminum Corp. It trades about 0.03 of its potential returns per unit of risk. Aluminum Corp of is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 686.00 in Aluminum Corp of on August 28, 2024 and sell it today you would earn a total of 71.00 from holding Aluminum Corp of or generate 10.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing Wantai Biological vs. Aluminum Corp of
Performance |
| Timeline |
| Beijing Wantai Biological |
| Aluminum Corp |
Beijing Wantai and Aluminum Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Wantai and Aluminum Corp
The main advantage of trading using opposite Beijing Wantai and Aluminum Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Wantai position performs unexpectedly, Aluminum Corp 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 Aluminum Corp will offset losses from the drop in Aluminum Corp's long position.| Beijing Wantai vs. Jiangyin Jianghua Microelectronics | Beijing Wantai vs. Guangzhou Haige Communications | Beijing Wantai vs. Fuzhou Rockchip Electronics | Beijing Wantai vs. Sinomach Automobile Co |
| Aluminum Corp vs. Wanhua Chemical Group | Aluminum Corp vs. Shandong Gold Mining | Aluminum Corp vs. Rongsheng Petrochemical Co | Aluminum Corp vs. Inner Mongolia BaoTou |
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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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