Correlation Between Huadong Medicine and Anji Foodstuff
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By analyzing existing cross correlation between Huadong Medicine Co and Anji Foodstuff Co, you can compare the effects of market volatilities on Huadong Medicine and Anji Foodstuff 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 Huadong Medicine with a short position of Anji Foodstuff. Check out your portfolio center. Please also check ongoing floating volatility patterns of Huadong Medicine and Anji Foodstuff.
Diversification Opportunities for Huadong Medicine and Anji Foodstuff
0.62 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Huadong and Anji is 0.62. Overlapping area represents the amount of risk that can be diversified away by holding Huadong Medicine Co and Anji Foodstuff Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anji Foodstuff and Huadong Medicine 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 Huadong Medicine Co are associated (or correlated) with Anji Foodstuff. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anji Foodstuff has no effect on the direction of Huadong Medicine i.e., Huadong Medicine and Anji Foodstuff go up and down completely randomly.
Pair Corralation between Huadong Medicine and Anji Foodstuff
Assuming the 90 days trading horizon Huadong Medicine Co is expected to under-perform the Anji Foodstuff. But the stock apears to be less risky and, when comparing its historical volatility, Huadong Medicine Co is 1.36 times less risky than Anji Foodstuff. The stock trades about -0.02 of its potential returns per unit of risk. The Anji Foodstuff Co is currently generating about 0.0 of returns per unit of risk over similar time horizon. If you would invest 988.00 in Anji Foodstuff Co on October 30, 2024 and sell it today you would lose (180.00) from holding Anji Foodstuff Co or give up 18.22% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Huadong Medicine Co vs. Anji Foodstuff Co
Performance |
| Timeline |
| Huadong Medicine |
| Anji Foodstuff |
Huadong Medicine and Anji Foodstuff Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Huadong Medicine and Anji Foodstuff
The main advantage of trading using opposite Huadong Medicine and Anji Foodstuff positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Huadong Medicine position performs unexpectedly, Anji Foodstuff 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 Anji Foodstuff will offset losses from the drop in Anji Foodstuff's long position.| Huadong Medicine vs. New China Life | Huadong Medicine vs. Ming Yang Smart | Huadong Medicine vs. 159681 | Huadong Medicine vs. 159005 |
| Anji Foodstuff vs. Ziel Home Furnishing | Anji Foodstuff vs. China Asset Management | Anji Foodstuff vs. Shenzhen Topway Video | Anji Foodstuff vs. Mengtian Home Group |
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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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