Correlation Between Aba Chemicals and Zhejiang Kingland
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By analyzing existing cross correlation between Aba Chemicals Corp and Zhejiang Kingland Pipeline, you can compare the effects of market volatilities on Aba Chemicals and Zhejiang Kingland 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 Zhejiang Kingland. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aba Chemicals and Zhejiang Kingland.
Diversification Opportunities for Aba Chemicals and Zhejiang Kingland
0.8 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aba and Zhejiang is 0.8. Overlapping area represents the amount of risk that can be diversified away by holding Aba Chemicals Corp and Zhejiang Kingland Pipeline in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhejiang Kingland 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 Zhejiang Kingland. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhejiang Kingland has no effect on the direction of Aba Chemicals i.e., Aba Chemicals and Zhejiang Kingland go up and down completely randomly.
Pair Corralation between Aba Chemicals and Zhejiang Kingland
Assuming the 90 days trading horizon Aba Chemicals Corp is expected to under-perform the Zhejiang Kingland. In addition to that, Aba Chemicals is 2.64 times more volatile than Zhejiang Kingland Pipeline. It trades about -0.26 of its total potential returns per unit of risk. Zhejiang Kingland Pipeline is currently generating about -0.15 per unit of volatility. If you would invest 653.00 in Zhejiang Kingland Pipeline on August 27, 2024 and sell it today you would lose (33.00) from holding Zhejiang Kingland Pipeline or give up 5.05% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aba Chemicals Corp vs. Zhejiang Kingland Pipeline
Performance |
| Timeline |
| Aba Chemicals Corp |
| Zhejiang Kingland |
Aba Chemicals and Zhejiang Kingland Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aba Chemicals and Zhejiang Kingland
The main advantage of trading using opposite Aba Chemicals and Zhejiang Kingland positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aba Chemicals position performs unexpectedly, Zhejiang Kingland 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 Zhejiang Kingland will offset losses from the drop in Zhejiang Kingland's long position.| Aba Chemicals vs. Zijin Mining Group | Aba Chemicals vs. Wanhua Chemical Group | Aba Chemicals vs. Baoshan Iron Steel | Aba Chemicals vs. Shandong Gold Mining |
| Zhejiang Kingland vs. Zhejiang JIULI Hi tech | Zhejiang Kingland vs. Suzhou Mingzhi Technology | Zhejiang Kingland vs. Wuhan Yangtze Communication | Zhejiang Kingland vs. Hubei Yingtong Telecommunication |
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 Money Flow Index module to determine momentum by analyzing Money Flow Index and other technical indicators.
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