Correlation Between Anhui Gujing and BYD Co
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By analyzing existing cross correlation between Anhui Gujing Distillery and BYD Co Ltd, you can compare the effects of market volatilities on Anhui Gujing and BYD Co 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 Anhui Gujing with a short position of BYD Co. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Gujing and BYD Co.
Diversification Opportunities for Anhui Gujing and BYD Co
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Anhui and BYD is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Gujing Distillery and BYD Co Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on BYD Co and Anhui Gujing 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 Anhui Gujing Distillery are associated (or correlated) with BYD Co. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of BYD Co has no effect on the direction of Anhui Gujing i.e., Anhui Gujing and BYD Co go up and down completely randomly.
Pair Corralation between Anhui Gujing and BYD Co
Assuming the 90 days trading horizon Anhui Gujing Distillery is expected to generate 1.56 times more return on investment than BYD Co. However, Anhui Gujing is 1.56 times more volatile than BYD Co Ltd. It trades about -0.09 of its potential returns per unit of risk. BYD Co Ltd is currently generating about -0.18 per unit of risk. If you would invest 19,930 in Anhui Gujing Distillery on August 27, 2024 and sell it today you would lose (1,239) from holding Anhui Gujing Distillery or give up 6.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Gujing Distillery vs. BYD Co Ltd
Performance |
| Timeline |
| Anhui Gujing Distillery |
| BYD Co |
Anhui Gujing and BYD Co Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Gujing and BYD Co
The main advantage of trading using opposite Anhui Gujing and BYD Co positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Gujing position performs unexpectedly, BYD Co 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 BYD Co will offset losses from the drop in BYD Co's long position.| Anhui Gujing vs. BYD Co Ltd | Anhui Gujing vs. China Mobile Limited | Anhui Gujing vs. Agricultural Bank of | Anhui Gujing vs. Industrial and Commercial |
| BYD Co vs. Changchun Faway Automobile | BYD Co vs. Songz Automobile Air | BYD Co vs. Tongyu Communication | BYD Co vs. Hubei Yingtong Telecommunication |
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 Premium Stories module to follow Macroaxis premium stories from verified contributors across different equity types, categories and coverage scope.
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