Correlation Between Wintao Communications and Anhui Deli
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By analyzing existing cross correlation between Wintao Communications Co and Anhui Deli Household, you can compare the effects of market volatilities on Wintao Communications and Anhui Deli 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 Wintao Communications with a short position of Anhui Deli. Check out your portfolio center. Please also check ongoing floating volatility patterns of Wintao Communications and Anhui Deli.
Diversification Opportunities for Wintao Communications and Anhui Deli
0.63 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Wintao and Anhui is 0.63. Overlapping area represents the amount of risk that can be diversified away by holding Wintao Communications Co and Anhui Deli Household in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anhui Deli Household and Wintao Communications 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 Wintao Communications Co are associated (or correlated) with Anhui Deli. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anhui Deli Household has no effect on the direction of Wintao Communications i.e., Wintao Communications and Anhui Deli go up and down completely randomly.
Pair Corralation between Wintao Communications and Anhui Deli
Assuming the 90 days trading horizon Wintao Communications Co is expected to generate 0.47 times more return on investment than Anhui Deli. However, Wintao Communications Co is 2.14 times less risky than Anhui Deli. It trades about 0.21 of its potential returns per unit of risk. Anhui Deli Household is currently generating about 0.06 per unit of risk. If you would invest 2,003 in Wintao Communications Co on November 7, 2024 and sell it today you would earn a total of 190.00 from holding Wintao Communications Co or generate 9.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Wintao Communications Co vs. Anhui Deli Household
Performance |
| Timeline |
| Wintao Communications |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Anhui Deli Household |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Wintao Communications and Anhui Deli Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Wintao Communications and Anhui Deli
The main advantage of trading using opposite Wintao Communications and Anhui Deli positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Wintao Communications position performs unexpectedly, Anhui Deli 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 Anhui Deli will offset losses from the drop in Anhui Deli's long position.The idea behind Wintao Communications Co and Anhui Deli Household pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk 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 Idea Analyzer module to analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas.
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