Correlation Between Chongqing Shunbo and Zhejiang Yayi
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By analyzing existing cross correlation between Chongqing Shunbo Aluminum and Zhejiang Yayi Metal, you can compare the effects of market volatilities on Chongqing Shunbo and Zhejiang Yayi 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 Chongqing Shunbo with a short position of Zhejiang Yayi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Shunbo and Zhejiang Yayi.
Diversification Opportunities for Chongqing Shunbo and Zhejiang Yayi
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Chongqing and Zhejiang is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Shunbo Aluminum and Zhejiang Yayi Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Yayi Metal and Chongqing Shunbo 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 Chongqing Shunbo Aluminum are associated (or correlated) with Zhejiang Yayi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Yayi Metal has no effect on the direction of Chongqing Shunbo i.e., Chongqing Shunbo and Zhejiang Yayi go up and down completely randomly.
Pair Corralation between Chongqing Shunbo and Zhejiang Yayi
Assuming the 90 days trading horizon Chongqing Shunbo is expected to generate 1.12 times less return on investment than Zhejiang Yayi. But when comparing it to its historical volatility, Chongqing Shunbo Aluminum is 1.46 times less risky than Zhejiang Yayi. It trades about 0.15 of its potential returns per unit of risk. Zhejiang Yayi Metal is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 1,926 in Zhejiang Yayi Metal on September 25, 2024 and sell it today you would earn a total of 513.00 from holding Zhejiang Yayi Metal or generate 26.64% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Very Strong |
Accuracy | 98.33% |
Values | Daily Returns |
Chongqing Shunbo Aluminum vs. Zhejiang Yayi Metal
Performance |
Timeline |
Chongqing Shunbo Aluminum |
Zhejiang Yayi Metal |
Chongqing Shunbo and Zhejiang Yayi Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Chongqing Shunbo and Zhejiang Yayi
The main advantage of trading using opposite Chongqing Shunbo and Zhejiang Yayi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Shunbo position performs unexpectedly, Zhejiang Yayi 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 Zhejiang Yayi will offset losses from the drop in Zhejiang Yayi's long position.Chongqing Shunbo vs. Wanhua Chemical Group | Chongqing Shunbo vs. Shandong Gold Mining | Chongqing Shunbo vs. Rongsheng Petrochemical Co | Chongqing Shunbo vs. Inner Mongolia BaoTou |
Zhejiang Yayi vs. Agricultural Bank of | Zhejiang Yayi vs. Industrial and Commercial | Zhejiang Yayi vs. Bank of China | Zhejiang Yayi vs. China Construction Bank |
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 Pattern Recognition module to use different Pattern Recognition models to time the market across multiple global exchanges.
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