Correlation Between Zhejiang Qianjiang and Allied Machinery
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By analyzing existing cross correlation between Zhejiang Qianjiang Motorcycle and Allied Machinery Co, you can compare the effects of market volatilities on Zhejiang Qianjiang and Allied Machinery 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 Zhejiang Qianjiang with a short position of Allied Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Zhejiang Qianjiang and Allied Machinery.
Diversification Opportunities for Zhejiang Qianjiang and Allied Machinery
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Zhejiang and Allied is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Zhejiang Qianjiang Motorcycle and Allied Machinery Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allied Machinery and Zhejiang Qianjiang 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 Zhejiang Qianjiang Motorcycle are associated (or correlated) with Allied Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allied Machinery has no effect on the direction of Zhejiang Qianjiang i.e., Zhejiang Qianjiang and Allied Machinery go up and down completely randomly.
Pair Corralation between Zhejiang Qianjiang and Allied Machinery
Assuming the 90 days trading horizon Zhejiang Qianjiang Motorcycle is expected to under-perform the Allied Machinery. In addition to that, Zhejiang Qianjiang is 1.05 times more volatile than Allied Machinery Co. It trades about -0.16 of its total potential returns per unit of risk. Allied Machinery Co is currently generating about 0.13 per unit of volatility. If you would invest 1,539 in Allied Machinery Co on August 28, 2024 and sell it today you would earn a total of 101.00 from holding Allied Machinery Co or generate 6.56% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Zhejiang Qianjiang Motorcycle vs. Allied Machinery Co
Performance |
| Timeline |
| Zhejiang Qianjiang |
| Allied Machinery |
Zhejiang Qianjiang and Allied Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Zhejiang Qianjiang and Allied Machinery
The main advantage of trading using opposite Zhejiang Qianjiang and Allied Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Zhejiang Qianjiang position performs unexpectedly, Allied Machinery 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 Allied Machinery will offset losses from the drop in Allied Machinery's long position.| Zhejiang Qianjiang vs. Changchun UP Optotech | Zhejiang Qianjiang vs. Dymatic Chemicals | Zhejiang Qianjiang vs. Kuangda Technology Group | Zhejiang Qianjiang vs. Shandong Polymer Biochemicals |
| Allied Machinery vs. Biwin Storage Technology | Allied Machinery vs. PetroChina Co Ltd | Allied Machinery vs. Industrial and Commercial | Allied Machinery vs. China Construction Bank |
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 CEOs Directory module to screen CEOs from public companies around the world.
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