Correlation Between Aba Chemicals and Tianjin Hi
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By analyzing existing cross correlation between Aba Chemicals Corp and Tianjin Hi Tech Development, you can compare the effects of market volatilities on Aba Chemicals and Tianjin Hi 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 Tianjin Hi. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aba Chemicals and Tianjin Hi.
Diversification Opportunities for Aba Chemicals and Tianjin Hi
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aba and Tianjin is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Aba Chemicals Corp and Tianjin Hi Tech Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tianjin Hi Tech 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 Tianjin Hi. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tianjin Hi Tech has no effect on the direction of Aba Chemicals i.e., Aba Chemicals and Tianjin Hi go up and down completely randomly.
Pair Corralation between Aba Chemicals and Tianjin Hi
Assuming the 90 days trading horizon Aba Chemicals Corp is expected to generate 1.28 times more return on investment than Tianjin Hi. However, Aba Chemicals is 1.28 times more volatile than Tianjin Hi Tech Development. It trades about 0.01 of its potential returns per unit of risk. Tianjin Hi Tech Development is currently generating about 0.01 per unit of risk. If you would invest 891.00 in Aba Chemicals Corp on September 12, 2024 and sell it today you would lose (77.00) from holding Aba Chemicals Corp or give up 8.64% 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. Tianjin Hi Tech Development
Performance |
| Timeline |
| Aba Chemicals Corp |
| Tianjin Hi Tech |
Aba Chemicals and Tianjin Hi Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aba Chemicals and Tianjin Hi
The main advantage of trading using opposite Aba Chemicals and Tianjin Hi positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aba Chemicals position performs unexpectedly, Tianjin Hi 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 Tianjin Hi will offset losses from the drop in Tianjin Hi's long position.| Aba Chemicals vs. Semiconductor Manufacturing Electronics | Aba Chemicals vs. GigaDevice SemiconductorBeiji | Aba Chemicals vs. Qinghaihuading Industrial Co | Aba Chemicals vs. MayAir Technology Co |
| Tianjin Hi vs. Gansu Jiu Steel | Tianjin Hi vs. Shandong Mining Machinery | Tianjin Hi vs. Aba Chemicals Corp | Tianjin Hi vs. BlueFocus Communication Group |
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 Sectors module to list of equity sectors categorizing publicly traded companies based on their primary business activities.
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