Correlation Between Shantui Construction and Anhui Transport
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By analyzing existing cross correlation between Shantui Construction Machinery and Anhui Transport Consulting, you can compare the effects of market volatilities on Shantui Construction and Anhui Transport 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 Shantui Construction with a short position of Anhui Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Shantui Construction and Anhui Transport.
Diversification Opportunities for Shantui Construction and Anhui Transport
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Shantui and Anhui is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Shantui Construction Machinery and Anhui Transport Consulting in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anhui Transport Cons and Shantui Construction 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 Shantui Construction Machinery are associated (or correlated) with Anhui Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anhui Transport Cons has no effect on the direction of Shantui Construction i.e., Shantui Construction and Anhui Transport go up and down completely randomly.
Pair Corralation between Shantui Construction and Anhui Transport
Assuming the 90 days trading horizon Shantui Construction Machinery is expected to generate 1.39 times more return on investment than Anhui Transport. However, Shantui Construction is 1.39 times more volatile than Anhui Transport Consulting. It trades about 0.39 of its potential returns per unit of risk. Anhui Transport Consulting is currently generating about 0.05 per unit of risk. If you would invest 760.00 in Shantui Construction Machinery on August 25, 2024 and sell it today you would earn a total of 250.00 from holding Shantui Construction Machinery or generate 32.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Shantui Construction Machinery vs. Anhui Transport Consulting
Performance |
| Timeline |
| Shantui Construction |
| Anhui Transport Cons |
Shantui Construction and Anhui Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Shantui Construction and Anhui Transport
The main advantage of trading using opposite Shantui Construction and Anhui Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Shantui Construction position performs unexpectedly, Anhui Transport 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 Anhui Transport will offset losses from the drop in Anhui Transport's long position.| Shantui Construction vs. Chengdu Kanghua Biological | Shantui Construction vs. Beijing Wantai Biological | Shantui Construction vs. Suzhou Novoprotein Scientific | Shantui Construction vs. Aluminum Corp of |
| Anhui Transport vs. Chengdu Kanghua Biological | Anhui Transport vs. Beijing Wantai Biological | Anhui Transport vs. Suzhou Novoprotein Scientific | Anhui Transport vs. Aluminum Corp of |
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 Stock Screener module to find equities using a custom stock filter or screen asymmetry in trading patterns, price, volume, or investment outlook..
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