Correlation Between Aba Chemicals and Zhongtong Guomai
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By analyzing existing cross correlation between Aba Chemicals Corp and Zhongtong Guomai Communication, you can compare the effects of market volatilities on Aba Chemicals and Zhongtong Guomai 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 Zhongtong Guomai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aba Chemicals and Zhongtong Guomai.
Diversification Opportunities for Aba Chemicals and Zhongtong Guomai
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aba and Zhongtong is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Aba Chemicals Corp and Zhongtong Guomai Communication in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhongtong Guomai Com 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 Zhongtong Guomai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhongtong Guomai Com has no effect on the direction of Aba Chemicals i.e., Aba Chemicals and Zhongtong Guomai go up and down completely randomly.
Pair Corralation between Aba Chemicals and Zhongtong Guomai
Assuming the 90 days trading horizon Aba Chemicals is expected to generate 4.51 times less return on investment than Zhongtong Guomai. In addition to that, Aba Chemicals is 1.17 times more volatile than Zhongtong Guomai Communication. It trades about 0.01 of its total potential returns per unit of risk. Zhongtong Guomai Communication is currently generating about 0.06 per unit of volatility. If you would invest 690.00 in Zhongtong Guomai Communication on September 12, 2024 and sell it today you would earn a total of 441.00 from holding Zhongtong Guomai Communication or generate 63.91% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aba Chemicals Corp vs. Zhongtong Guomai Communication
Performance |
| Timeline |
| Aba Chemicals Corp |
| Zhongtong Guomai Com |
Aba Chemicals and Zhongtong Guomai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aba Chemicals and Zhongtong Guomai
The main advantage of trading using opposite Aba Chemicals and Zhongtong Guomai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aba Chemicals position performs unexpectedly, Zhongtong Guomai 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 Zhongtong Guomai will offset losses from the drop in Zhongtong Guomai'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 |
| Zhongtong Guomai vs. Gansu Jiu Steel | Zhongtong Guomai vs. Shandong Mining Machinery | Zhongtong Guomai vs. Aba Chemicals Corp | Zhongtong Guomai 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 Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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