Correlation Between Anhui Huaren and China International
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By analyzing existing cross correlation between Anhui Huaren Health and China International Capital, you can compare the effects of market volatilities on Anhui Huaren and China International 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 Anhui Huaren with a short position of China International. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Huaren and China International.
Diversification Opportunities for Anhui Huaren and China International
0.89 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Anhui and China is 0.89. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Huaren Health and China International Capital in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China International and Anhui Huaren 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 Anhui Huaren Health are associated (or correlated) with China International. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China International has no effect on the direction of Anhui Huaren i.e., Anhui Huaren and China International go up and down completely randomly.
Pair Corralation between Anhui Huaren and China International
Assuming the 90 days trading horizon Anhui Huaren Health is expected to generate 0.98 times more return on investment than China International. However, Anhui Huaren Health is 1.02 times less risky than China International. It trades about 0.01 of its potential returns per unit of risk. China International Capital is currently generating about -0.04 per unit of risk. If you would invest 1,235 in Anhui Huaren Health on August 31, 2024 and sell it today you would lose (20.00) from holding Anhui Huaren Health or give up 1.62% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Huaren Health vs. China International Capital
Performance |
| Timeline |
| Anhui Huaren Health |
| China International |
Anhui Huaren and China International Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Huaren and China International
The main advantage of trading using opposite Anhui Huaren and China International positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Huaren position performs unexpectedly, China International 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 China International will offset losses from the drop in China International's long position.| Anhui Huaren vs. Lutian Machinery Co | Anhui Huaren vs. PetroChina Co Ltd | Anhui Huaren vs. Bank of China | Anhui Huaren vs. Gansu Jiu Steel |
| China International vs. Innovative Medical Management | China International vs. AVIC Fund Management | China International vs. Humanwell Healthcare Group | China International vs. Anhui Huaren Health |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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