Correlation Between Anhui Gujing and Bank of Beijing Co Ltd
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By analyzing existing cross correlation between Anhui Gujing Distillery and Bank of Beijing, you can compare the effects of market volatilities on Anhui Gujing and Bank of Beijing Co Ltd 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 Gujing with a short position of Bank of Beijing Co Ltd. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Gujing and Bank of Beijing Co Ltd.
Diversification Opportunities for Anhui Gujing and Bank of Beijing Co Ltd
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Anhui and Bank is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Gujing Distillery and Bank of Beijing in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of Beijing Co Ltd and Anhui Gujing 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 Gujing Distillery are associated (or correlated) with Bank of Beijing Co Ltd. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of Beijing Co Ltd has no effect on the direction of Anhui Gujing i.e., Anhui Gujing and Bank of Beijing Co Ltd go up and down completely randomly.
Pair Corralation between Anhui Gujing and Bank of Beijing Co Ltd
Assuming the 90 days trading horizon Anhui Gujing Distillery is expected to under-perform the Bank of Beijing Co Ltd. In addition to that, Anhui Gujing is 1.45 times more volatile than Bank of Beijing. It trades about -0.01 of its total potential returns per unit of risk. Bank of Beijing is currently generating about 0.05 per unit of volatility. If you would invest 457.00 in Bank of Beijing on August 31, 2024 and sell it today you would earn a total of 112.00 from holding Bank of Beijing or generate 24.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 99.72% |
| Values | Daily Returns |
Anhui Gujing Distillery vs. Bank of Beijing
Performance |
| Timeline |
| Anhui Gujing Distillery |
| Bank of Beijing Co Ltd |
Anhui Gujing and Bank of Beijing Co Ltd Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Gujing and Bank of Beijing Co Ltd
The main advantage of trading using opposite Anhui Gujing and Bank of Beijing Co Ltd positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Gujing position performs unexpectedly, Bank of Beijing Co Ltd 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 Bank of Beijing Co Ltd will offset losses from the drop in Bank of Beijing Co Ltd's long position.| Anhui Gujing vs. Lutian Machinery Co | Anhui Gujing vs. PetroChina Co Ltd | Anhui Gujing vs. Bank of China | Anhui Gujing vs. Gansu Jiu Steel |
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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 Suggestion module to get suggestions outside of your existing asset allocation including your own model portfolios.
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