Correlation Between Industrial Bank and China Nonferrous
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By analyzing existing cross correlation between Industrial Bank Co and China Nonferrous Metal, you can compare the effects of market volatilities on Industrial Bank and China Nonferrous 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 Industrial Bank with a short position of China Nonferrous. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial Bank and China Nonferrous.
Diversification Opportunities for Industrial Bank and China Nonferrous
0.7 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Industrial and China is 0.7. Overlapping area represents the amount of risk that can be diversified away by holding Industrial Bank Co and China Nonferrous Metal in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Nonferrous Metal and Industrial Bank 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 Industrial Bank Co are associated (or correlated) with China Nonferrous. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Nonferrous Metal has no effect on the direction of Industrial Bank i.e., Industrial Bank and China Nonferrous go up and down completely randomly.
Pair Corralation between Industrial Bank and China Nonferrous
Assuming the 90 days trading horizon Industrial Bank is expected to generate 1.07 times less return on investment than China Nonferrous. But when comparing it to its historical volatility, Industrial Bank Co is 1.62 times less risky than China Nonferrous. It trades about 0.03 of its potential returns per unit of risk. China Nonferrous Metal is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 473.00 in China Nonferrous Metal on September 19, 2024 and sell it today you would earn a total of 33.00 from holding China Nonferrous Metal or generate 6.98% return on investment over 90 days.
Time Period | 3 Months [change] |
Direction | Moves Together |
Strength | Significant |
Accuracy | 100.0% |
Values | Daily Returns |
Industrial Bank Co vs. China Nonferrous Metal
Performance |
Timeline |
Industrial Bank |
China Nonferrous Metal |
Industrial Bank and China Nonferrous Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Industrial Bank and China Nonferrous
The main advantage of trading using opposite Industrial Bank and China Nonferrous positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial Bank position performs unexpectedly, China Nonferrous 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 China Nonferrous will offset losses from the drop in China Nonferrous' long position.Industrial Bank vs. Industrial and Commercial | Industrial Bank vs. China Construction Bank | Industrial Bank vs. Bank of China | Industrial Bank vs. Agricultural Bank of |
China Nonferrous vs. Zijin Mining Group | China Nonferrous vs. Wanhua Chemical Group | China Nonferrous vs. Baoshan Iron Steel | China Nonferrous vs. Shandong Gold Mining |
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 Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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