Correlation Between Gifore Agricultural and Aofu Environmental
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By analyzing existing cross correlation between Gifore Agricultural Machinery and Aofu Environmental Technology, you can compare the effects of market volatilities on Gifore Agricultural 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 Gifore Agricultural with a short position of Aofu Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gifore Agricultural and Aofu Environmental.
Diversification Opportunities for Gifore Agricultural and Aofu Environmental
0.19 | Correlation Coefficient |
Average diversification
The 3 months correlation between Gifore and Aofu is 0.19. Overlapping area represents the amount of risk that can be diversified away by holding Gifore Agricultural Machinery and Aofu Environmental Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aofu Environmental and Gifore Agricultural 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 Gifore Agricultural Machinery 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 Gifore Agricultural i.e., Gifore Agricultural and Aofu Environmental go up and down completely randomly.
Pair Corralation between Gifore Agricultural and Aofu Environmental
Assuming the 90 days trading horizon Gifore Agricultural Machinery is expected to generate 0.88 times more return on investment than Aofu Environmental. However, Gifore Agricultural Machinery is 1.13 times less risky than Aofu Environmental. It trades about 0.01 of its potential returns per unit of risk. Aofu Environmental Technology is currently generating about -0.06 per unit of risk. If you would invest 516.00 in Gifore Agricultural Machinery on November 7, 2024 and sell it today you would lose (22.00) from holding Gifore Agricultural Machinery or give up 4.26% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gifore Agricultural Machinery vs. Aofu Environmental Technology
Performance |
| Timeline |
| Gifore Agricultural |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
| Aofu Environmental |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Gifore Agricultural and Aofu Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gifore Agricultural and Aofu Environmental
The main advantage of trading using opposite Gifore Agricultural and Aofu Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gifore Agricultural 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.The idea behind Gifore Agricultural Machinery and Aofu Environmental Technology 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 Funds Screener module to find actively-traded funds from around the world traded on over 30 global exchanges.
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