Correlation Between Linzhou Heavy and Agricultural Bank
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By analyzing existing cross correlation between Linzhou Heavy Machinery and Agricultural Bank of, you can compare the effects of market volatilities on Linzhou Heavy and Agricultural Bank 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 Linzhou Heavy with a short position of Agricultural Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Linzhou Heavy and Agricultural Bank.
Diversification Opportunities for Linzhou Heavy and Agricultural Bank
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Linzhou and Agricultural is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding Linzhou Heavy Machinery and Agricultural Bank of in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Agricultural Bank and Linzhou Heavy 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 Linzhou Heavy Machinery are associated (or correlated) with Agricultural Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Agricultural Bank has no effect on the direction of Linzhou Heavy i.e., Linzhou Heavy and Agricultural Bank go up and down completely randomly.
Pair Corralation between Linzhou Heavy and Agricultural Bank
Assuming the 90 days trading horizon Linzhou Heavy Machinery is expected to generate 2.68 times more return on investment than Agricultural Bank. However, Linzhou Heavy is 2.68 times more volatile than Agricultural Bank of. It trades about 0.06 of its potential returns per unit of risk. Agricultural Bank of is currently generating about 0.11 per unit of risk. If you would invest 233.00 in Linzhou Heavy Machinery on September 12, 2024 and sell it today you would earn a total of 232.00 from holding Linzhou Heavy Machinery or generate 99.57% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Linzhou Heavy Machinery vs. Agricultural Bank of
Performance |
| Timeline |
| Linzhou Heavy Machinery |
| Agricultural Bank |
Linzhou Heavy and Agricultural Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Linzhou Heavy and Agricultural Bank
The main advantage of trading using opposite Linzhou Heavy and Agricultural Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Linzhou Heavy position performs unexpectedly, Agricultural Bank 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 Agricultural Bank will offset losses from the drop in Agricultural Bank's long position.| Linzhou Heavy vs. Agricultural Bank of | Linzhou Heavy vs. Industrial and Commercial | Linzhou Heavy vs. Bank of China | Linzhou Heavy vs. PetroChina Co Ltd |
| Agricultural Bank vs. China Petroleum Chemical | Agricultural Bank vs. PetroChina Co Ltd | Agricultural Bank vs. China Mobile Limited | Agricultural Bank vs. Industrial and Commercial |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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