Correlation Between Dongfeng Automobile and Anker Innovations
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By analyzing existing cross correlation between Dongfeng Automobile Co and Anker Innovations Technology, you can compare the effects of market volatilities on Dongfeng Automobile and Anker Innovations 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 Dongfeng Automobile with a short position of Anker Innovations. Check out your portfolio center. Please also check ongoing floating volatility patterns of Dongfeng Automobile and Anker Innovations.
Diversification Opportunities for Dongfeng Automobile and Anker Innovations
0.78 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Dongfeng and Anker is 0.78. Overlapping area represents the amount of risk that can be diversified away by holding Dongfeng Automobile Co and Anker Innovations Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anker Innovations and Dongfeng Automobile 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 Dongfeng Automobile Co are associated (or correlated) with Anker Innovations. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anker Innovations has no effect on the direction of Dongfeng Automobile i.e., Dongfeng Automobile and Anker Innovations go up and down completely randomly.
Pair Corralation between Dongfeng Automobile and Anker Innovations
Assuming the 90 days trading horizon Dongfeng Automobile is expected to generate 2.11 times less return on investment than Anker Innovations. In addition to that, Dongfeng Automobile is 1.03 times more volatile than Anker Innovations Technology. It trades about 0.03 of its total potential returns per unit of risk. Anker Innovations Technology is currently generating about 0.07 per unit of volatility. If you would invest 4,444 in Anker Innovations Technology on September 26, 2024 and sell it today you would earn a total of 5,175 from holding Anker Innovations Technology or generate 116.45% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Dongfeng Automobile Co vs. Anker Innovations Technology
Performance |
| Timeline |
| Dongfeng Automobile |
| Anker Innovations |
Dongfeng Automobile and Anker Innovations Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Dongfeng Automobile and Anker Innovations
The main advantage of trading using opposite Dongfeng Automobile and Anker Innovations positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Dongfeng Automobile position performs unexpectedly, Anker Innovations 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 Anker Innovations will offset losses from the drop in Anker Innovations' long position.| Dongfeng Automobile vs. Chengtun Mining Group | Dongfeng Automobile vs. CICT Mobile Communication | Dongfeng Automobile vs. Dr Peng Telecom | Dongfeng Automobile vs. Jilin Jlu Communication |
| Anker Innovations vs. Bank of China | Anker Innovations vs. Kweichow Moutai Co | Anker Innovations vs. PetroChina Co Ltd | Anker Innovations vs. Bank of Communications |
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 Aroon Oscillator module to analyze current equity momentum using Aroon Oscillator and other momentum ratios.
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