Correlation Between Aba Chemicals and CIMC Vehicles
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By analyzing existing cross correlation between Aba Chemicals Corp and CIMC Vehicles Co, you can compare the effects of market volatilities on Aba Chemicals and CIMC Vehicles 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 CIMC Vehicles. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aba Chemicals and CIMC Vehicles.
Diversification Opportunities for Aba Chemicals and CIMC Vehicles
0.9 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Aba and CIMC is 0.9. Overlapping area represents the amount of risk that can be diversified away by holding Aba Chemicals Corp and CIMC Vehicles Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CIMC Vehicles 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 CIMC Vehicles. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CIMC Vehicles has no effect on the direction of Aba Chemicals i.e., Aba Chemicals and CIMC Vehicles go up and down completely randomly.
Pair Corralation between Aba Chemicals and CIMC Vehicles
Assuming the 90 days trading horizon Aba Chemicals Corp is expected to generate 1.69 times more return on investment than CIMC Vehicles. However, Aba Chemicals is 1.69 times more volatile than CIMC Vehicles Co. It trades about 0.05 of its potential returns per unit of risk. CIMC Vehicles Co is currently generating about 0.04 per unit of risk. If you would invest 531.00 in Aba Chemicals Corp on November 2, 2024 and sell it today you would earn a total of 84.00 from holding Aba Chemicals Corp or generate 15.82% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aba Chemicals Corp vs. CIMC Vehicles Co
Performance |
| Timeline |
| Aba Chemicals Corp |
| CIMC Vehicles |
Aba Chemicals and CIMC Vehicles Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aba Chemicals and CIMC Vehicles
The main advantage of trading using opposite Aba Chemicals and CIMC Vehicles positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aba Chemicals position performs unexpectedly, CIMC Vehicles 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 CIMC Vehicles will offset losses from the drop in CIMC Vehicles' long position.| Aba Chemicals vs. Anhui Deli Household | Aba Chemicals vs. Hefei Metalforming Mach | Aba Chemicals vs. Easyhome New Retail | Aba Chemicals vs. Pengxin International Mining |
| CIMC Vehicles vs. Linktel Technologies Co | CIMC Vehicles vs. Kunwu Jiuding Investment | CIMC Vehicles vs. Xiamen Insight Investment | CIMC Vehicles vs. Zhejiang Construction Investment |
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 Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
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