Correlation Between Chongqing Road and Dongguan Aohai
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By analyzing existing cross correlation between Chongqing Road Bridge and Dongguan Aohai Technology, you can compare the effects of market volatilities on Chongqing Road and Dongguan Aohai 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 Chongqing Road with a short position of Dongguan Aohai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chongqing Road and Dongguan Aohai.
Diversification Opportunities for Chongqing Road and Dongguan Aohai
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Chongqing and Dongguan is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Chongqing Road Bridge and Dongguan Aohai Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dongguan Aohai Technology and Chongqing Road 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 Chongqing Road Bridge are associated (or correlated) with Dongguan Aohai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dongguan Aohai Technology has no effect on the direction of Chongqing Road i.e., Chongqing Road and Dongguan Aohai go up and down completely randomly.
Pair Corralation between Chongqing Road and Dongguan Aohai
Assuming the 90 days trading horizon Chongqing Road Bridge is expected to generate 1.0 times more return on investment than Dongguan Aohai. However, Chongqing Road Bridge is 1.0 times less risky than Dongguan Aohai. It trades about 0.02 of its potential returns per unit of risk. Dongguan Aohai Technology is currently generating about 0.02 per unit of risk. If you would invest 486.00 in Chongqing Road Bridge on October 16, 2024 and sell it today you would earn a total of 31.00 from holding Chongqing Road Bridge or generate 6.38% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chongqing Road Bridge vs. Dongguan Aohai Technology
Performance |
| Timeline |
| Chongqing Road Bridge |
| Dongguan Aohai Technology |
Chongqing Road and Dongguan Aohai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chongqing Road and Dongguan Aohai
The main advantage of trading using opposite Chongqing Road and Dongguan Aohai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chongqing Road position performs unexpectedly, Dongguan Aohai 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 Dongguan Aohai will offset losses from the drop in Dongguan Aohai's long position.| Chongqing Road vs. Sunwave Communications Co | Chongqing Road vs. Gansu Huangtai Wine marketing | Chongqing Road vs. Unisplendour Corp | Chongqing Road vs. Tianjin Hi Tech Development |
| Dongguan Aohai vs. China Petroleum Chemical | Dongguan Aohai vs. PetroChina Co Ltd | Dongguan Aohai vs. China State Construction | Dongguan Aohai vs. China Railway Group |
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 Share Portfolio module to track or share privately all of your investments from the convenience of any device.
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