Correlation Between Anhui Gujing and Lutian Machinery
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By analyzing existing cross correlation between Anhui Gujing Distillery and Lutian Machinery Co, you can compare the effects of market volatilities on Anhui Gujing and Lutian Machinery 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 Lutian Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Gujing and Lutian Machinery.
Diversification Opportunities for Anhui Gujing and Lutian Machinery
-0.03 | Correlation Coefficient |
Good diversification
The 3 months correlation between Anhui and Lutian is -0.03. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Gujing Distillery and Lutian Machinery Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lutian Machinery 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 Lutian Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lutian Machinery has no effect on the direction of Anhui Gujing i.e., Anhui Gujing and Lutian Machinery go up and down completely randomly.
Pair Corralation between Anhui Gujing and Lutian Machinery
Assuming the 90 days trading horizon Anhui Gujing Distillery is expected to generate 0.69 times more return on investment than Lutian Machinery. However, Anhui Gujing Distillery is 1.45 times less risky than Lutian Machinery. It trades about 0.11 of its potential returns per unit of risk. Lutian Machinery Co is currently generating about 0.0 per unit of risk. If you would invest 10,795 in Anhui Gujing Distillery on November 2, 2024 and sell it today you would earn a total of 485.00 from holding Anhui Gujing Distillery or generate 4.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Gujing Distillery vs. Lutian Machinery Co
Performance |
| Timeline |
| Anhui Gujing Distillery |
| Lutian Machinery |
Anhui Gujing and Lutian Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Gujing and Lutian Machinery
The main advantage of trading using opposite Anhui Gujing and Lutian Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Gujing position performs unexpectedly, Lutian Machinery 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 Lutian Machinery will offset losses from the drop in Lutian Machinery's long position.| Anhui Gujing vs. State Grid InformationCommunication | Anhui Gujing vs. Ziel Home Furnishing | Anhui Gujing vs. Wuhan Yangtze Communication | Anhui Gujing vs. UE Furniture Co |
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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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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