Correlation Between Beijing Watertek and AVCON Information
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By analyzing existing cross correlation between Beijing Watertek Information and AVCON Information Tech, you can compare the effects of market volatilities on Beijing Watertek and AVCON Information 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 Beijing Watertek with a short position of AVCON Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Beijing Watertek and AVCON Information.
Diversification Opportunities for Beijing Watertek and AVCON Information
0.92 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Beijing and AVCON is 0.92. Overlapping area represents the amount of risk that can be diversified away by holding Beijing Watertek Information and AVCON Information Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AVCON Information Tech and Beijing Watertek 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 Beijing Watertek Information are associated (or correlated) with AVCON Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AVCON Information Tech has no effect on the direction of Beijing Watertek i.e., Beijing Watertek and AVCON Information go up and down completely randomly.
Pair Corralation between Beijing Watertek and AVCON Information
Assuming the 90 days trading horizon Beijing Watertek Information is expected to under-perform the AVCON Information. But the stock apears to be less risky and, when comparing its historical volatility, Beijing Watertek Information is 1.1 times less risky than AVCON Information. The stock trades about -0.19 of its potential returns per unit of risk. The AVCON Information Tech is currently generating about -0.08 of returns per unit of risk over similar time horizon. If you would invest 409.00 in AVCON Information Tech on October 30, 2024 and sell it today you would lose (24.00) from holding AVCON Information Tech or give up 5.87% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 95.24% |
| Values | Daily Returns |
Beijing Watertek Information vs. AVCON Information Tech
Performance |
| Timeline |
| Beijing Watertek Inf |
| AVCON Information Tech |
Beijing Watertek and AVCON Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Beijing Watertek and AVCON Information
The main advantage of trading using opposite Beijing Watertek and AVCON Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Beijing Watertek position performs unexpectedly, AVCON Information 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 AVCON Information will offset losses from the drop in AVCON Information's long position.| Beijing Watertek vs. Heilongjiang Transport Development | Beijing Watertek vs. Jiugui Liquor Co | Beijing Watertek vs. GigaDevice SemiconductorBeiji | Beijing Watertek vs. Tongling Nonferrous Metals |
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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