Correlation Between Aba Chemicals and Sportsoul
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By analyzing existing cross correlation between Aba Chemicals Corp and Sportsoul Co Ltd, you can compare the effects of market volatilities on Aba Chemicals and Sportsoul 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 Sportsoul. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aba Chemicals and Sportsoul.
Diversification Opportunities for Aba Chemicals and Sportsoul
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aba and Sportsoul is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Aba Chemicals Corp and Sportsoul Co Ltd in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sportsoul 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 Sportsoul. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sportsoul has no effect on the direction of Aba Chemicals i.e., Aba Chemicals and Sportsoul go up and down completely randomly.
Pair Corralation between Aba Chemicals and Sportsoul
Assuming the 90 days trading horizon Aba Chemicals Corp is expected to under-perform the Sportsoul. But the stock apears to be less risky and, when comparing its historical volatility, Aba Chemicals Corp is 1.1 times less risky than Sportsoul. The stock trades about -0.1 of its potential returns per unit of risk. The Sportsoul Co Ltd is currently generating about 0.19 of returns per unit of risk over similar time horizon. If you would invest 1,066 in Sportsoul Co Ltd on November 4, 2024 and sell it today you would earn a total of 89.00 from holding Sportsoul Co Ltd or generate 8.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aba Chemicals Corp vs. Sportsoul Co Ltd
Performance |
| Timeline |
| Aba Chemicals Corp |
| Sportsoul |
Aba Chemicals and Sportsoul Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aba Chemicals and Sportsoul
The main advantage of trading using opposite Aba Chemicals and Sportsoul positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aba Chemicals position performs unexpectedly, Sportsoul 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 Sportsoul will offset losses from the drop in Sportsoul's long position.| Aba Chemicals vs. Tongyu Communication | Aba Chemicals vs. Eyebright Medical Technology | Aba Chemicals vs. China Sports Industry | Aba Chemicals vs. Fujian Newland Computer |
| Sportsoul vs. Guangzhou KingTeller Technology | Sportsoul vs. Zhejiang Construction Investment | Sportsoul vs. Olympic Circuit Technology | Sportsoul vs. Jiangsu Financial Leasing |
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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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