Correlation Between Aba Chemicals and Bus Online
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By analyzing existing cross correlation between Aba Chemicals Corp and Bus Online Co, you can compare the effects of market volatilities on Aba Chemicals and Bus Online 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 Bus Online. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aba Chemicals and Bus Online.
Diversification Opportunities for Aba Chemicals and Bus Online
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aba and Bus is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding Aba Chemicals Corp and Bus Online Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bus Online 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 Bus Online. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bus Online has no effect on the direction of Aba Chemicals i.e., Aba Chemicals and Bus Online go up and down completely randomly.
Pair Corralation between Aba Chemicals and Bus Online
Assuming the 90 days trading horizon Aba Chemicals Corp is expected to under-perform the Bus Online. In addition to that, Aba Chemicals is 1.24 times more volatile than Bus Online Co. It trades about -0.17 of its total potential returns per unit of risk. Bus Online Co is currently generating about 0.17 per unit of volatility. If you would invest 505.00 in Bus Online Co on September 13, 2024 and sell it today you would earn a total of 40.00 from holding Bus Online Co or generate 7.92% 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. Bus Online Co
Performance |
| Timeline |
| Aba Chemicals Corp |
| Bus Online |
Aba Chemicals and Bus Online Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aba Chemicals and Bus Online
The main advantage of trading using opposite Aba Chemicals and Bus Online positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aba Chemicals position performs unexpectedly, Bus Online 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 Bus Online will offset losses from the drop in Bus Online'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 |
| Bus Online vs. Haima Automobile Group | Bus Online vs. BTG Hotels Group | Bus Online vs. Dongfeng Automobile Co | Bus Online vs. Changchun Faway Automobile |
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 Watchlist Optimization module to optimize watchlists to build efficient portfolios or rebalance existing positions based on the mean-variance optimization algorithm.
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