Correlation Between Asia Potash and Elite Color
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By analyzing existing cross correlation between Asia Potash International and Elite Color Environmental, you can compare the effects of market volatilities on Asia Potash and Elite Color 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 Asia Potash with a short position of Elite Color. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asia Potash and Elite Color.
Diversification Opportunities for Asia Potash and Elite Color
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Asia and Elite is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Asia Potash International and Elite Color Environmental in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Elite Color Environmental and Asia Potash 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 Asia Potash International are associated (or correlated) with Elite Color. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Elite Color Environmental has no effect on the direction of Asia Potash i.e., Asia Potash and Elite Color go up and down completely randomly.
Pair Corralation between Asia Potash and Elite Color
Assuming the 90 days trading horizon Asia Potash is expected to generate 1.19 times less return on investment than Elite Color. In addition to that, Asia Potash is 1.01 times more volatile than Elite Color Environmental. It trades about 0.15 of its total potential returns per unit of risk. Elite Color Environmental is currently generating about 0.18 per unit of volatility. If you would invest 611.00 in Elite Color Environmental on September 5, 2024 and sell it today you would earn a total of 78.00 from holding Elite Color Environmental or generate 12.77% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asia Potash International vs. Elite Color Environmental
Performance |
| Timeline |
| Asia Potash International |
| Elite Color Environmental |
Asia Potash and Elite Color Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asia Potash and Elite Color
The main advantage of trading using opposite Asia Potash and Elite Color positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asia Potash position performs unexpectedly, Elite Color 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 Elite Color will offset losses from the drop in Elite Color's long position.| Asia Potash vs. Elite Color Environmental | Asia Potash vs. Nexchip Semiconductor Corp | Asia Potash vs. Vontron Technology Co | Asia Potash vs. Sinocat Environmental Technology |
| Elite Color vs. Zijin Mining Group | Elite Color vs. Baoshan Iron Steel | Elite Color vs. Rongsheng Petrochemical Co | Elite Color vs. Shandong Gold Mining |
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 Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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