Correlation Between Anhui Gujing and Zhengping RoadBridge
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By analyzing existing cross correlation between Anhui Gujing Distillery and Zhengping RoadBridge Constr, you can compare the effects of market volatilities on Anhui Gujing and Zhengping RoadBridge 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 Zhengping RoadBridge. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Gujing and Zhengping RoadBridge.
Diversification Opportunities for Anhui Gujing and Zhengping RoadBridge
-0.53 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Anhui and Zhengping is -0.53. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Gujing Distillery and Zhengping RoadBridge Constr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhengping RoadBridge 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 Zhengping RoadBridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhengping RoadBridge has no effect on the direction of Anhui Gujing i.e., Anhui Gujing and Zhengping RoadBridge go up and down completely randomly.
Pair Corralation between Anhui Gujing and Zhengping RoadBridge
Assuming the 90 days trading horizon Anhui Gujing Distillery is expected to generate 0.54 times more return on investment than Zhengping RoadBridge. However, Anhui Gujing Distillery is 1.86 times less risky than Zhengping RoadBridge. It trades about -0.01 of its potential returns per unit of risk. Zhengping RoadBridge Constr is currently generating about -0.01 per unit of risk. If you would invest 16,687 in Anhui Gujing Distillery on November 7, 2024 and sell it today you would lose (79.00) from holding Anhui Gujing Distillery or give up 0.47% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Gujing Distillery vs. Zhengping RoadBridge Constr
Performance |
| Timeline |
| Anhui Gujing Distillery |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Zhengping RoadBridge |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
Anhui Gujing and Zhengping RoadBridge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Gujing and Zhengping RoadBridge
The main advantage of trading using opposite Anhui Gujing and Zhengping RoadBridge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Gujing position performs unexpectedly, Zhengping RoadBridge 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 Zhengping RoadBridge will offset losses from the drop in Zhengping RoadBridge's long position.The idea behind Anhui Gujing Distillery and Zhengping RoadBridge Constr 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.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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