Correlation Between Acelon Chemicals and Jinan Acetate
Can any of the company-specific risk be diversified away by investing in both Acelon Chemicals and Jinan Acetate at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Acelon Chemicals and Jinan Acetate into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Acelon Chemicals Fiber and Jinan Acetate Chemical, you can compare the effects of market volatilities on Acelon Chemicals and Jinan Acetate 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 Acelon Chemicals with a short position of Jinan Acetate. Check out your portfolio center. Please also check ongoing floating volatility patterns of Acelon Chemicals and Jinan Acetate.
Diversification Opportunities for Acelon Chemicals and Jinan Acetate
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Acelon and Jinan is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Acelon Chemicals Fiber and Jinan Acetate Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Jinan Acetate Chemical and Acelon Chemicals 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 Acelon Chemicals Fiber are associated (or correlated) with Jinan Acetate. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Jinan Acetate Chemical has no effect on the direction of Acelon Chemicals i.e., Acelon Chemicals and Jinan Acetate go up and down completely randomly.
Pair Corralation between Acelon Chemicals and Jinan Acetate
If you would invest 84,800 in Jinan Acetate Chemical on November 2, 2024 and sell it today you would lose (300.00) from holding Jinan Acetate Chemical or give up 0.35% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 1.72% |
| Values | Daily Returns |
Acelon Chemicals Fiber vs. Jinan Acetate Chemical
Performance |
| Timeline |
| Acelon Chemicals Fiber |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Jinan Acetate Chemical |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Acelon Chemicals and Jinan Acetate Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Acelon Chemicals and Jinan Acetate
The main advantage of trading using opposite Acelon Chemicals and Jinan Acetate positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Acelon Chemicals position performs unexpectedly, Jinan Acetate 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 Jinan Acetate will offset losses from the drop in Jinan Acetate's long position.The idea behind Acelon Chemicals Fiber and Jinan Acetate Chemical 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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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