Correlation Between Beijing YanDong and HeBei Jinniu
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By analyzing existing cross correlation between Beijing YanDong MicroElectronic and HeBei Jinniu Chemical, you can compare the effects of market volatilities on Beijing YanDong and HeBei Jinniu 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 YanDong with a short position of HeBei Jinniu. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing YanDong and HeBei Jinniu.
Diversification Opportunities for Beijing YanDong and HeBei Jinniu
-0.06 | Correlation Coefficient |
Good diversification
The 3 months correlation between Beijing and HeBei is -0.06. Overlapping area represents the amount of risk that can be diversified away by holding Beijing YanDong MicroElectroni and HeBei Jinniu Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on HeBei Jinniu Chemical and Beijing YanDong 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 YanDong MicroElectronic are associated (or correlated) with HeBei Jinniu. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of HeBei Jinniu Chemical has no effect on the direction of Beijing YanDong i.e., Beijing YanDong and HeBei Jinniu go up and down completely randomly.
Pair Corralation between Beijing YanDong and HeBei Jinniu
Assuming the 90 days trading horizon Beijing YanDong MicroElectronic is expected to under-perform the HeBei Jinniu. But the stock apears to be less risky and, when comparing its historical volatility, Beijing YanDong MicroElectronic is 1.39 times less risky than HeBei Jinniu. The stock trades about -0.15 of its potential returns per unit of risk. The HeBei Jinniu Chemical is currently generating about 0.24 of returns per unit of risk over similar time horizon. If you would invest 479.00 in HeBei Jinniu Chemical on October 30, 2024 and sell it today you would earn a total of 83.00 from holding HeBei Jinniu Chemical or generate 17.33% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Beijing YanDong MicroElectroni vs. HeBei Jinniu Chemical
Performance |
| Timeline |
| Beijing YanDong Micr |
| HeBei Jinniu Chemical |
Beijing YanDong and HeBei Jinniu Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing YanDong and HeBei Jinniu
The main advantage of trading using opposite Beijing YanDong and HeBei Jinniu positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing YanDong position performs unexpectedly, HeBei Jinniu 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 HeBei Jinniu will offset losses from the drop in HeBei Jinniu's long position.| Beijing YanDong vs. Maxvision Technology Corp | Beijing YanDong vs. Sanxiang Advanced Materials | Beijing YanDong vs. Swancor Advanced Materials | Beijing YanDong vs. Jiangnan Mould Plastic |
| HeBei Jinniu vs. Chengtun Mining Group | HeBei Jinniu vs. Huaibei Mining Holdings | HeBei Jinniu vs. Zijin Mining Group | HeBei Jinniu vs. Hainan Mining Co |
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 Correlation Analysis module to reduce portfolio risk simply by holding instruments which are not perfectly correlated.
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