Correlation Between Jiangxi Ganfeng and Aofu Environmental
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By analyzing existing cross correlation between Jiangxi Ganfeng Lithium and Aofu Environmental Technology, you can compare the effects of market volatilities on Jiangxi Ganfeng and Aofu Environmental 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 Jiangxi Ganfeng with a short position of Aofu Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Jiangxi Ganfeng and Aofu Environmental.
Diversification Opportunities for Jiangxi Ganfeng and Aofu Environmental
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Jiangxi and Aofu is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Jiangxi Ganfeng Lithium and Aofu Environmental Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aofu Environmental and Jiangxi Ganfeng 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 Jiangxi Ganfeng Lithium are associated (or correlated) with Aofu Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aofu Environmental has no effect on the direction of Jiangxi Ganfeng i.e., Jiangxi Ganfeng and Aofu Environmental go up and down completely randomly.
Pair Corralation between Jiangxi Ganfeng and Aofu Environmental
Assuming the 90 days trading horizon Jiangxi Ganfeng Lithium is expected to generate 1.2 times more return on investment than Aofu Environmental. However, Jiangxi Ganfeng is 1.2 times more volatile than Aofu Environmental Technology. It trades about 0.2 of its potential returns per unit of risk. Aofu Environmental Technology is currently generating about 0.2 per unit of risk. If you would invest 2,610 in Jiangxi Ganfeng Lithium on September 2, 2024 and sell it today you would earn a total of 1,595 from holding Jiangxi Ganfeng Lithium or generate 61.11% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Jiangxi Ganfeng Lithium vs. Aofu Environmental Technology
Performance |
| Timeline |
| Jiangxi Ganfeng Lithium |
| Aofu Environmental |
Jiangxi Ganfeng and Aofu Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Jiangxi Ganfeng and Aofu Environmental
The main advantage of trading using opposite Jiangxi Ganfeng and Aofu Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Jiangxi Ganfeng position performs unexpectedly, Aofu Environmental 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 Aofu Environmental will offset losses from the drop in Aofu Environmental's long position.| Jiangxi Ganfeng vs. Hongrun Construction Group | Jiangxi Ganfeng vs. Yili Chuanning Biotechnology | Jiangxi Ganfeng vs. Sichuan Hebang Biotechnology | Jiangxi Ganfeng vs. Tengda Construction Group |
| Aofu Environmental vs. Zijin Mining Group | Aofu Environmental vs. Baoshan Iron Steel | Aofu Environmental vs. Shandong Gold Mining | Aofu Environmental vs. Rongsheng Petrochemical 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 Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
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