Correlation Between Guangzhou KingTeller and Anhui Jianghuai
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By analyzing existing cross correlation between Guangzhou KingTeller Technology and Anhui Jianghuai Automobile, you can compare the effects of market volatilities on Guangzhou KingTeller and Anhui Jianghuai 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 Guangzhou KingTeller with a short position of Anhui Jianghuai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangzhou KingTeller and Anhui Jianghuai.
Diversification Opportunities for Guangzhou KingTeller and Anhui Jianghuai
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Guangzhou and Anhui is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Guangzhou KingTeller Technolog and Anhui Jianghuai Automobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anhui Jianghuai Auto and Guangzhou KingTeller 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 Guangzhou KingTeller Technology are associated (or correlated) with Anhui Jianghuai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anhui Jianghuai Auto has no effect on the direction of Guangzhou KingTeller i.e., Guangzhou KingTeller and Anhui Jianghuai go up and down completely randomly.
Pair Corralation between Guangzhou KingTeller and Anhui Jianghuai
Assuming the 90 days trading horizon Guangzhou KingTeller is expected to generate 1.42 times less return on investment than Anhui Jianghuai. But when comparing it to its historical volatility, Guangzhou KingTeller Technology is 1.14 times less risky than Anhui Jianghuai. It trades about 0.16 of its potential returns per unit of risk. Anhui Jianghuai Automobile is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 1,843 in Anhui Jianghuai Automobile on September 5, 2024 and sell it today you would earn a total of 1,642 from holding Anhui Jianghuai Automobile or generate 89.09% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangzhou KingTeller Technolog vs. Anhui Jianghuai Automobile
Performance |
| Timeline |
| Guangzhou KingTeller |
| Anhui Jianghuai Auto |
Guangzhou KingTeller and Anhui Jianghuai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangzhou KingTeller and Anhui Jianghuai
The main advantage of trading using opposite Guangzhou KingTeller and Anhui Jianghuai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangzhou KingTeller position performs unexpectedly, Anhui Jianghuai 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 Jianghuai will offset losses from the drop in Anhui Jianghuai's long position.The idea behind Guangzhou KingTeller Technology and Anhui Jianghuai Automobile 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.
| Anhui Jianghuai vs. Guangzhou KingTeller Technology | Anhui Jianghuai vs. Keli Sensing Technology | Anhui Jianghuai vs. HUAQIN TECHNOLOGY LTD | Anhui Jianghuai vs. Soyea Technology Co |
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 Idea Optimizer module to use advanced portfolio builder with pre-computed micro ideas to build optimal portfolio .
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