Correlation Between Aba Chemicals and National Silicon
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By analyzing existing cross correlation between Aba Chemicals Corp and National Silicon Industry, you can compare the effects of market volatilities on Aba Chemicals and National Silicon 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 National Silicon. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aba Chemicals and National Silicon.
Diversification Opportunities for Aba Chemicals and National Silicon
0.87 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Aba and National is 0.87. Overlapping area represents the amount of risk that can be diversified away by holding Aba Chemicals Corp and National Silicon Industry in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on National Silicon Industry 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 National Silicon. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of National Silicon Industry has no effect on the direction of Aba Chemicals i.e., Aba Chemicals and National Silicon go up and down completely randomly.
Pair Corralation between Aba Chemicals and National Silicon
Assuming the 90 days trading horizon Aba Chemicals Corp is expected to generate 1.03 times more return on investment than National Silicon. However, Aba Chemicals is 1.03 times more volatile than National Silicon Industry. It trades about -0.1 of its potential returns per unit of risk. National Silicon Industry is currently generating about -0.18 per unit of risk. If you would invest 877.00 in Aba Chemicals Corp on September 12, 2024 and sell it today you would lose (63.00) from holding Aba Chemicals Corp or give up 7.18% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 95.65% |
| Values | Daily Returns |
Aba Chemicals Corp vs. National Silicon Industry
Performance |
| Timeline |
| Aba Chemicals Corp |
| National Silicon Industry |
Aba Chemicals and National Silicon Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aba Chemicals and National Silicon
The main advantage of trading using opposite Aba Chemicals and National Silicon positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aba Chemicals position performs unexpectedly, National Silicon 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 National Silicon will offset losses from the drop in National Silicon'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 |
| National Silicon vs. Gansu Jiu Steel | National Silicon vs. Shandong Mining Machinery | National Silicon vs. Aba Chemicals Corp | National Silicon 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 Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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