Correlation Between Xiangcai and Anhui Transport
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By analyzing existing cross correlation between Xiangcai Co and Anhui Transport Consulting, you can compare the effects of market volatilities on Xiangcai and Anhui Transport 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 Xiangcai with a short position of Anhui Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Xiangcai and Anhui Transport.
Diversification Opportunities for Xiangcai and Anhui Transport
0.94 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Xiangcai and Anhui is 0.94. Overlapping area represents the amount of risk that can be diversified away by holding Xiangcai Co and Anhui Transport Consulting in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anhui Transport Cons and Xiangcai 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 Xiangcai Co are associated (or correlated) with Anhui Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anhui Transport Cons has no effect on the direction of Xiangcai i.e., Xiangcai and Anhui Transport go up and down completely randomly.
Pair Corralation between Xiangcai and Anhui Transport
Assuming the 90 days trading horizon Xiangcai is expected to generate 2.37 times less return on investment than Anhui Transport. In addition to that, Xiangcai is 1.12 times more volatile than Anhui Transport Consulting. It trades about 0.06 of its total potential returns per unit of risk. Anhui Transport Consulting is currently generating about 0.16 per unit of volatility. If you would invest 915.00 in Anhui Transport Consulting on September 4, 2024 and sell it today you would earn a total of 67.00 from holding Anhui Transport Consulting or generate 7.32% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Xiangcai Co vs. Anhui Transport Consulting
Performance |
| Timeline |
| Xiangcai |
| Anhui Transport Cons |
Xiangcai and Anhui Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Xiangcai and Anhui Transport
The main advantage of trading using opposite Xiangcai and Anhui Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Xiangcai position performs unexpectedly, Anhui Transport 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 Transport will offset losses from the drop in Anhui Transport's long position.| Xiangcai vs. Ningbo Thermal Power | Xiangcai vs. Guocheng Mining Co | Xiangcai vs. Zhejiang Yayi Metal | Xiangcai vs. Beijing HuaYuanYiTong Thermal |
| Anhui Transport vs. Industrial and Commercial | Anhui Transport vs. Agricultural Bank of | Anhui Transport vs. China Construction Bank | Anhui Transport vs. Bank of China |
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 Comparator module to compare the composition, asset allocations and performance of any two portfolios in your account.
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