Correlation Between PARKEN Sport and MAANSHAN IRON

Can any of the company-specific risk be diversified away by investing in both PARKEN Sport and MAANSHAN IRON at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining PARKEN Sport and MAANSHAN IRON into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between PARKEN Sport Entertainment and MAANSHAN IRON H , you can compare the effects of market volatilities on PARKEN Sport and MAANSHAN IRON 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 PARKEN Sport with a short position of MAANSHAN IRON. Check out your portfolio center. Please also check ongoing floating volatility patterns of PARKEN Sport and MAANSHAN IRON.

Diversification Opportunities for PARKEN Sport and MAANSHAN IRON

0.76

Correlation Coefficient

PARKEN Sport  MAANSHAN IRON

Poor diversification

The 3 months correlation between PARKEN and MAANSHAN is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding PARKEN Sport Entertainment and MAANSHAN IRON H in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on MAANSHAN IRON H and PARKEN Sport 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 PARKEN Sport Entertainment are associated (or correlated) with MAANSHAN IRON. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of MAANSHAN IRON H has no effect on the direction of PARKEN Sport i.e., PARKEN Sport and MAANSHAN IRON go up and down completely randomly.

Pair Corralation between PARKEN Sport and MAANSHAN IRON

Assuming the 90 days horizon PARKEN Sport Entertainment is expected to generate 0.56 times more return on investment than MAANSHAN IRON. However, PARKEN Sport Entertainment is 1.79 times less risky than MAANSHAN IRON. It trades about 0.27 of its potential returns per unit of risk. MAANSHAN IRON H is currently generating about 0.1 per unit of risk. If you would invest  1,735  in PARKEN Sport Entertainment on April 25, 2025 and sell it today you would earn a total of  715.00  from holding PARKEN Sport Entertainment or generate 41.21% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Significant
Accuracy	100.0%
Values	Daily Returns

PARKEN Sport Entertainment  vs.  MAANSHAN IRON H

PARKEN Sport Enterta

Risk-Adjusted Performance

Solid

Compared to the overall equity markets, risk-adjusted returns on investments in PARKEN Sport Entertainment are ranked lower than 21 (%) of all global equities and portfolios over the last 90 days. Despite nearly uncertain basic indicators, PARKEN Sport reported solid returns over the last few months and may actually be approaching a breakup point.

MAANSHAN IRON H

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in MAANSHAN IRON H are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively uncertain basic indicators, MAANSHAN IRON unveiled solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with PARKEN Sport and MAANSHAN IRON

The main advantage of trading using opposite PARKEN Sport and MAANSHAN IRON positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PARKEN Sport position performs unexpectedly, MAANSHAN IRON 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 MAANSHAN IRON will offset losses from the drop in MAANSHAN IRON's long position.

The idea behind PARKEN Sport Entertainment and MAANSHAN IRON H pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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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 Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.