Correlation Between Anhui Deli and Lutian Machinery
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By analyzing existing cross correlation between Anhui Deli Household and Lutian Machinery Co, you can compare the effects of market volatilities on Anhui Deli and Lutian 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 Anhui Deli with a short position of Lutian Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Deli and Lutian Machinery.
Diversification Opportunities for Anhui Deli and Lutian Machinery
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Anhui and Lutian is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Deli Household and Lutian Machinery Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lutian Machinery and Anhui Deli 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 Anhui Deli Household are associated (or correlated) with Lutian Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lutian Machinery has no effect on the direction of Anhui Deli i.e., Anhui Deli and Lutian Machinery go up and down completely randomly.
Pair Corralation between Anhui Deli and Lutian Machinery
Assuming the 90 days trading horizon Anhui Deli Household is expected to generate 1.48 times more return on investment than Lutian Machinery. However, Anhui Deli is 1.48 times more volatile than Lutian Machinery Co. It trades about 0.0 of its potential returns per unit of risk. Lutian Machinery Co is currently generating about -0.01 per unit of risk. If you would invest 636.00 in Anhui Deli Household on September 12, 2024 and sell it today you would lose (124.00) from holding Anhui Deli Household or give up 19.5% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Deli Household vs. Lutian Machinery Co
Performance |
| Timeline |
| Anhui Deli Household |
| Lutian Machinery |
Anhui Deli and Lutian Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Deli and Lutian Machinery
The main advantage of trading using opposite Anhui Deli and Lutian Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Deli position performs unexpectedly, Lutian 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 Lutian Machinery will offset losses from the drop in Lutian Machinery's long position.| Anhui Deli vs. Lutian Machinery Co | Anhui Deli vs. PetroChina Co Ltd | Anhui Deli vs. Bank of China | Anhui Deli vs. Gansu Jiu Steel |
| Lutian Machinery vs. Agricultural Bank of | Lutian Machinery vs. Industrial and Commercial | Lutian Machinery vs. Bank of China | Lutian Machinery vs. PetroChina Co Ltd |
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 Performance Analysis module to check effects of mean-variance optimization against your current asset allocation.
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