Correlation Between Xiamen Jihong and Aofu Environmental
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By analyzing existing cross correlation between Xiamen Jihong Package and Aofu Environmental Technology, you can compare the effects of market volatilities on Xiamen Jihong 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 Xiamen Jihong with a short position of Aofu Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiamen Jihong and Aofu Environmental.
Diversification Opportunities for Xiamen Jihong and Aofu Environmental
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Xiamen and Aofu is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Xiamen Jihong Package and Aofu Environmental Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aofu Environmental and Xiamen Jihong 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 Xiamen Jihong Package 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 Xiamen Jihong i.e., Xiamen Jihong and Aofu Environmental go up and down completely randomly.
Pair Corralation between Xiamen Jihong and Aofu Environmental
Assuming the 90 days trading horizon Xiamen Jihong Package is expected to generate 1.19 times more return on investment than Aofu Environmental. However, Xiamen Jihong is 1.19 times more volatile than Aofu Environmental Technology. It trades about 0.14 of its potential returns per unit of risk. Aofu Environmental Technology is currently generating about 0.11 per unit of risk. If you would invest 1,446 in Xiamen Jihong Package on September 6, 2024 and sell it today you would earn a total of 141.00 from holding Xiamen Jihong Package or generate 9.75% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiamen Jihong Package vs. Aofu Environmental Technology
Performance |
| Timeline |
| Xiamen Jihong Package |
| Aofu Environmental |
Xiamen Jihong and Aofu Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiamen Jihong and Aofu Environmental
The main advantage of trading using opposite Xiamen Jihong and Aofu Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiamen Jihong 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.| Xiamen Jihong vs. Zijin Mining Group | Xiamen Jihong vs. Wanhua Chemical Group | Xiamen Jihong vs. Baoshan Iron Steel | Xiamen Jihong vs. Rongsheng Petrochemical Co |
| Aofu Environmental vs. Zijin Mining Group | Aofu Environmental vs. Wanhua Chemical Group | Aofu Environmental vs. Baoshan Iron Steel | 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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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