Correlation Between Anhui Gujing and Dongfeng Automobile
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By analyzing existing cross correlation between Anhui Gujing Distillery and Dongfeng Automobile Co, you can compare the effects of market volatilities on Anhui Gujing and Dongfeng Automobile 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 Dongfeng Automobile. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Gujing and Dongfeng Automobile.
Diversification Opportunities for Anhui Gujing and Dongfeng Automobile
0.26 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Anhui and Dongfeng is 0.26. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Gujing Distillery and Dongfeng Automobile Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongfeng Automobile 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 Dongfeng Automobile. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongfeng Automobile has no effect on the direction of Anhui Gujing i.e., Anhui Gujing and Dongfeng Automobile go up and down completely randomly.
Pair Corralation between Anhui Gujing and Dongfeng Automobile
Assuming the 90 days trading horizon Anhui Gujing Distillery is expected to generate 0.58 times more return on investment than Dongfeng Automobile. However, Anhui Gujing Distillery is 1.71 times less risky than Dongfeng Automobile. It trades about -0.05 of its potential returns per unit of risk. Dongfeng Automobile Co is currently generating about -0.19 per unit of risk. If you would invest 16,931 in Anhui Gujing Distillery on November 3, 2024 and sell it today you would lose (323.00) from holding Anhui Gujing Distillery or give up 1.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Gujing Distillery vs. Dongfeng Automobile Co
Performance |
| Timeline |
| Anhui Gujing Distillery |
| Dongfeng Automobile |
Anhui Gujing and Dongfeng Automobile Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Gujing and Dongfeng Automobile
The main advantage of trading using opposite Anhui Gujing and Dongfeng Automobile positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Gujing position performs unexpectedly, Dongfeng Automobile 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 Dongfeng Automobile will offset losses from the drop in Dongfeng Automobile's long position.| Anhui Gujing vs. Eastroc Beverage Group | Anhui Gujing vs. UE Furniture Co | Anhui Gujing vs. Jiangsu Financial Leasing | Anhui Gujing vs. Ziel Home Furnishing |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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