Correlation Between Anhui Jinhe and Sichuan Teway
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By analyzing existing cross correlation between Anhui Jinhe Industrial and Sichuan Teway Food, you can compare the effects of market volatilities on Anhui Jinhe and Sichuan Teway 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 Jinhe with a short position of Sichuan Teway. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Jinhe and Sichuan Teway.
Diversification Opportunities for Anhui Jinhe and Sichuan Teway
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Anhui and Sichuan is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Jinhe Industrial and Sichuan Teway Food in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sichuan Teway Food and Anhui Jinhe 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 Jinhe Industrial are associated (or correlated) with Sichuan Teway. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sichuan Teway Food has no effect on the direction of Anhui Jinhe i.e., Anhui Jinhe and Sichuan Teway go up and down completely randomly.
Pair Corralation between Anhui Jinhe and Sichuan Teway
Assuming the 90 days trading horizon Anhui Jinhe Industrial is expected to generate 0.88 times more return on investment than Sichuan Teway. However, Anhui Jinhe Industrial is 1.14 times less risky than Sichuan Teway. It trades about 0.07 of its potential returns per unit of risk. Sichuan Teway Food is currently generating about -0.07 per unit of risk. If you would invest 2,369 in Anhui Jinhe Industrial on August 28, 2024 and sell it today you would earn a total of 71.00 from holding Anhui Jinhe Industrial or generate 3.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Jinhe Industrial vs. Sichuan Teway Food
Performance |
| Timeline |
| Anhui Jinhe Industrial |
| Sichuan Teway Food |
Anhui Jinhe and Sichuan Teway Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Jinhe and Sichuan Teway
The main advantage of trading using opposite Anhui Jinhe and Sichuan Teway positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Jinhe position performs unexpectedly, Sichuan Teway 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 Sichuan Teway will offset losses from the drop in Sichuan Teway's long position.| Anhui Jinhe vs. Zijin Mining Group | Anhui Jinhe vs. Wanhua Chemical Group | Anhui Jinhe vs. Baoshan Iron Steel | Anhui Jinhe vs. Shandong Gold Mining |
| Sichuan Teway vs. China Petroleum Chemical | Sichuan Teway vs. PetroChina Co Ltd | Sichuan Teway vs. China State Construction | Sichuan Teway vs. China Railway 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 Content Syndication module to quickly integrate customizable finance content to your own investment portal.
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