Correlation Between HeBei Jinniu and Metallurgical
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By analyzing existing cross correlation between HeBei Jinniu Chemical and Metallurgical of, you can compare the effects of market volatilities on HeBei Jinniu and Metallurgical 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 HeBei Jinniu with a short position of Metallurgical. Check out your portfolio center. Please also check ongoing floating volatility patterns of HeBei Jinniu and Metallurgical.
Diversification Opportunities for HeBei Jinniu and Metallurgical
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between HeBei and Metallurgical is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding HeBei Jinniu Chemical and Metallurgical of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Metallurgical and HeBei Jinniu 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 HeBei Jinniu Chemical are associated (or correlated) with Metallurgical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Metallurgical has no effect on the direction of HeBei Jinniu i.e., HeBei Jinniu and Metallurgical go up and down completely randomly.
Pair Corralation between HeBei Jinniu and Metallurgical
Assuming the 90 days trading horizon HeBei Jinniu Chemical is expected to generate 1.93 times more return on investment than Metallurgical. However, HeBei Jinniu is 1.93 times more volatile than Metallurgical of. It trades about 0.08 of its potential returns per unit of risk. Metallurgical of is currently generating about 0.02 per unit of risk. If you would invest 447.00 in HeBei Jinniu Chemical on September 25, 2024 and sell it today you would earn a total of 49.00 from holding HeBei Jinniu Chemical or generate 10.96% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
HeBei Jinniu Chemical vs. Metallurgical of
Performance |
Timeline |
HeBei Jinniu Chemical |
Metallurgical |
HeBei Jinniu and Metallurgical Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with HeBei Jinniu and Metallurgical
The main advantage of trading using opposite HeBei Jinniu and Metallurgical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if HeBei Jinniu position performs unexpectedly, Metallurgical 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 Metallurgical will offset losses from the drop in Metallurgical's long position.HeBei Jinniu vs. Zijin Mining Group | HeBei Jinniu vs. Wanhua Chemical Group | HeBei Jinniu vs. Baoshan Iron Steel | HeBei Jinniu vs. Shandong Gold Mining |
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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 Global Correlations module to find global opportunities by holding instruments from different markets.
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