Correlation Between Sinosteel Luonai and Jiangsu Zhongtian
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By analyzing existing cross correlation between Sinosteel Luonai Materials and Jiangsu Zhongtian Technology, you can compare the effects of market volatilities on Sinosteel Luonai and Jiangsu Zhongtian 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 Sinosteel Luonai with a short position of Jiangsu Zhongtian. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sinosteel Luonai and Jiangsu Zhongtian.
Diversification Opportunities for Sinosteel Luonai and Jiangsu Zhongtian
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Sinosteel and Jiangsu is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Sinosteel Luonai Materials and Jiangsu Zhongtian Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jiangsu Zhongtian and Sinosteel Luonai 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 Sinosteel Luonai Materials are associated (or correlated) with Jiangsu Zhongtian. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jiangsu Zhongtian has no effect on the direction of Sinosteel Luonai i.e., Sinosteel Luonai and Jiangsu Zhongtian go up and down completely randomly.
Pair Corralation between Sinosteel Luonai and Jiangsu Zhongtian
Assuming the 90 days trading horizon Sinosteel Luonai Materials is expected to generate 1.03 times more return on investment than Jiangsu Zhongtian. However, Sinosteel Luonai is 1.03 times more volatile than Jiangsu Zhongtian Technology. It trades about -0.06 of its potential returns per unit of risk. Jiangsu Zhongtian Technology is currently generating about -0.09 per unit of risk. If you would invest 420.00 in Sinosteel Luonai Materials on September 26, 2024 and sell it today you would lose (11.00) from holding Sinosteel Luonai Materials or give up 2.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sinosteel Luonai Materials vs. Jiangsu Zhongtian Technology
Performance |
| Timeline |
| Sinosteel Luonai Mat |
| Jiangsu Zhongtian |
Sinosteel Luonai and Jiangsu Zhongtian Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sinosteel Luonai and Jiangsu Zhongtian
The main advantage of trading using opposite Sinosteel Luonai and Jiangsu Zhongtian positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sinosteel Luonai position performs unexpectedly, Jiangsu Zhongtian 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 Jiangsu Zhongtian will offset losses from the drop in Jiangsu Zhongtian's long position.| Sinosteel Luonai vs. Zijin Mining Group | Sinosteel Luonai vs. Wanhua Chemical Group | Sinosteel Luonai vs. Baoshan Iron Steel | Sinosteel Luonai vs. Shandong Gold Mining |
| Jiangsu Zhongtian vs. Kweichow Moutai Co | Jiangsu Zhongtian vs. Contemporary Amperex Technology | Jiangsu Zhongtian vs. G bits Network Technology | Jiangsu Zhongtian vs. BYD Co Ltd |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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