Correlation Between Aba Chemicals and Westone Information
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By analyzing existing cross correlation between Aba Chemicals Corp and Westone Information Industry, you can compare the effects of market volatilities on Aba Chemicals and Westone Information 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 Westone Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aba Chemicals and Westone Information.
Diversification Opportunities for Aba Chemicals and Westone Information
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Aba and Westone is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Aba Chemicals Corp and Westone Information Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Westone Information 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 Westone Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Westone Information has no effect on the direction of Aba Chemicals i.e., Aba Chemicals and Westone Information go up and down completely randomly.
Pair Corralation between Aba Chemicals and Westone Information
Assuming the 90 days trading horizon Aba Chemicals Corp is expected to under-perform the Westone Information. In addition to that, Aba Chemicals is 1.21 times more volatile than Westone Information Industry. It trades about -0.17 of its total potential returns per unit of risk. Westone Information Industry is currently generating about -0.16 per unit of volatility. If you would invest 2,008 in Westone Information Industry on September 13, 2024 and sell it today you would lose (163.00) from holding Westone Information Industry or give up 8.12% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aba Chemicals Corp vs. Westone Information Industry
Performance |
| Timeline |
| Aba Chemicals Corp |
| Westone Information |
Aba Chemicals and Westone Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aba Chemicals and Westone Information
The main advantage of trading using opposite Aba Chemicals and Westone Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aba Chemicals position performs unexpectedly, Westone Information 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 Westone Information will offset losses from the drop in Westone Information'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 |
| Westone Information vs. Industrial and Commercial | Westone Information vs. Agricultural Bank of | Westone Information vs. China Construction Bank | Westone Information vs. Bank of China |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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