Correlation Between Anhui Fuhuang and Pengxin International
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By analyzing existing cross correlation between Anhui Fuhuang Steel and Pengxin International Mining, you can compare the effects of market volatilities on Anhui Fuhuang and Pengxin International 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 Fuhuang with a short position of Pengxin International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Fuhuang and Pengxin International.
Diversification Opportunities for Anhui Fuhuang and Pengxin International
0.42 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Anhui and Pengxin is 0.42. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Fuhuang Steel and Pengxin International Mining in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Pengxin International and Anhui Fuhuang 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 Fuhuang Steel are associated (or correlated) with Pengxin International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Pengxin International has no effect on the direction of Anhui Fuhuang i.e., Anhui Fuhuang and Pengxin International go up and down completely randomly.
Pair Corralation between Anhui Fuhuang and Pengxin International
Assuming the 90 days trading horizon Anhui Fuhuang is expected to generate 1.09 times less return on investment than Pengxin International. But when comparing it to its historical volatility, Anhui Fuhuang Steel is 1.1 times less risky than Pengxin International. It trades about 0.01 of its potential returns per unit of risk. Pengxin International Mining is currently generating about 0.01 of returns per unit of risk over similar time horizon. If you would invest 320.00 in Pengxin International Mining on November 7, 2024 and sell it today you would lose (5.00) from holding Pengxin International Mining or give up 1.56% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 99.79% |
| Values | Daily Returns |
Anhui Fuhuang Steel vs. Pengxin International Mining
Performance |
| Timeline |
| Anhui Fuhuang Steel |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Pengxin International |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Anhui Fuhuang and Pengxin International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Fuhuang and Pengxin International
The main advantage of trading using opposite Anhui Fuhuang and Pengxin International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Fuhuang position performs unexpectedly, Pengxin International 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 Pengxin International will offset losses from the drop in Pengxin International's long position.The idea behind Anhui Fuhuang Steel and Pengxin International Mining 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.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 Sync Your Broker module to sync your existing holdings, watchlists, positions or portfolios from thousands of online brokerage services, banks, investment account aggregators and robo-advisors..
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