Correlation Between Aba Chemicals and Zhongshan Public
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By analyzing existing cross correlation between Aba Chemicals Corp and Zhongshan Public Utilities, you can compare the effects of market volatilities on Aba Chemicals and Zhongshan Public 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 Aba Chemicals with a short position of Zhongshan Public. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aba Chemicals and Zhongshan Public.
Diversification Opportunities for Aba Chemicals and Zhongshan Public
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aba and Zhongshan is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Aba Chemicals Corp and Zhongshan Public Utilities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongshan Public Uti and Aba 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 Aba Chemicals Corp are associated (or correlated) with Zhongshan Public. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongshan Public Uti has no effect on the direction of Aba Chemicals i.e., Aba Chemicals and Zhongshan Public go up and down completely randomly.
Pair Corralation between Aba Chemicals and Zhongshan Public
Assuming the 90 days trading horizon Aba Chemicals Corp is expected to generate 1.99 times more return on investment than Zhongshan Public. However, Aba Chemicals is 1.99 times more volatile than Zhongshan Public Utilities. It trades about 0.16 of its potential returns per unit of risk. Zhongshan Public Utilities is currently generating about 0.16 per unit of risk. If you would invest 526.00 in Aba Chemicals Corp on September 12, 2024 and sell it today you would earn a total of 294.00 from holding Aba Chemicals Corp or generate 55.89% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aba Chemicals Corp vs. Zhongshan Public Utilities
Performance |
| Timeline |
| Aba Chemicals Corp |
| Zhongshan Public Uti |
Aba Chemicals and Zhongshan Public Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aba Chemicals and Zhongshan Public
The main advantage of trading using opposite Aba Chemicals and Zhongshan Public positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aba Chemicals position performs unexpectedly, Zhongshan Public 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 Zhongshan Public will offset losses from the drop in Zhongshan Public's long position.| Aba Chemicals vs. Changchun Faway Automobile | Aba Chemicals vs. Zhongyin Babi Food | Aba Chemicals vs. Jiangsu Financial Leasing | Aba Chemicals vs. Xiangyang Automobile Bearing |
| Zhongshan Public vs. Ningbo Tip Rubber | Zhongshan Public vs. Western Mining Co | Zhongshan Public vs. Cangzhou Mingzhu Plastic | Zhongshan Public vs. Chongqing Sulian Plastic |
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 Stocks Directory module to find actively traded stocks across global markets.
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