Correlation Between Aba Chemicals and Shaanxi Meineng
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By analyzing existing cross correlation between Aba Chemicals Corp and Shaanxi Meineng Clean, you can compare the effects of market volatilities on Aba Chemicals and Shaanxi Meineng 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 Shaanxi Meineng. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aba Chemicals and Shaanxi Meineng.
Diversification Opportunities for Aba Chemicals and Shaanxi Meineng
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aba and Shaanxi is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Aba Chemicals Corp and Shaanxi Meineng Clean in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shaanxi Meineng Clean 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 Shaanxi Meineng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shaanxi Meineng Clean has no effect on the direction of Aba Chemicals i.e., Aba Chemicals and Shaanxi Meineng go up and down completely randomly.
Pair Corralation between Aba Chemicals and Shaanxi Meineng
Assuming the 90 days trading horizon Aba Chemicals Corp is expected to generate 2.08 times more return on investment than Shaanxi Meineng. However, Aba Chemicals is 2.08 times more volatile than Shaanxi Meineng Clean. It trades about 0.09 of its potential returns per unit of risk. Shaanxi Meineng Clean is currently generating about 0.07 per unit of risk. If you would invest 558.00 in Aba Chemicals Corp on September 13, 2024 and sell it today you would earn a total of 262.00 from holding Aba Chemicals Corp or generate 46.95% 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. Shaanxi Meineng Clean
Performance |
| Timeline |
| Aba Chemicals Corp |
| Shaanxi Meineng Clean |
Aba Chemicals and Shaanxi Meineng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aba Chemicals and Shaanxi Meineng
The main advantage of trading using opposite Aba Chemicals and Shaanxi Meineng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aba Chemicals position performs unexpectedly, Shaanxi Meineng 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 Shaanxi Meineng will offset losses from the drop in Shaanxi Meineng'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 |
| Shaanxi Meineng vs. Innovative Medical Management | Shaanxi Meineng vs. Cowealth Medical China | Shaanxi Meineng vs. Zhongzhu Medical Holdings | Shaanxi Meineng vs. Touchstone International Medical |
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 Manager module to state of the art Portfolio Manager to monitor and improve performance of your invested capital.
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