Correlation Between Lotus Health and Anhui Jianghuai
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By analyzing existing cross correlation between Lotus Health Group and Anhui Jianghuai Automobile, you can compare the effects of market volatilities on Lotus Health and Anhui Jianghuai 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 Lotus Health with a short position of Anhui Jianghuai. Check out your portfolio center. Please also check ongoing floating volatility patterns of Lotus Health and Anhui Jianghuai.
Diversification Opportunities for Lotus Health and Anhui Jianghuai
-0.22 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Lotus and Anhui is -0.22. Overlapping area represents the amount of risk that can be diversified away by holding Lotus Health Group and Anhui Jianghuai Automobile in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anhui Jianghuai Auto and Lotus Health 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 Lotus Health Group are associated (or correlated) with Anhui Jianghuai. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anhui Jianghuai Auto has no effect on the direction of Lotus Health i.e., Lotus Health and Anhui Jianghuai go up and down completely randomly.
Pair Corralation between Lotus Health and Anhui Jianghuai
Assuming the 90 days trading horizon Lotus Health is expected to generate 34.8 times less return on investment than Anhui Jianghuai. In addition to that, Lotus Health is 1.48 times more volatile than Anhui Jianghuai Automobile. It trades about 0.01 of its total potential returns per unit of risk. Anhui Jianghuai Automobile is currently generating about 0.33 per unit of volatility. If you would invest 3,500 in Anhui Jianghuai Automobile on November 7, 2024 and sell it today you would earn a total of 589.00 from holding Anhui Jianghuai Automobile or generate 16.83% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Lotus Health Group vs. Anhui Jianghuai Automobile
Performance |
| Timeline |
| Lotus Health Group |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Insignificant
| Anhui Jianghuai Auto |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Weak
Lotus Health and Anhui Jianghuai Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Lotus Health and Anhui Jianghuai
The main advantage of trading using opposite Lotus Health and Anhui Jianghuai positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Lotus Health position performs unexpectedly, Anhui Jianghuai 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 Jianghuai will offset losses from the drop in Anhui Jianghuai's long position.The idea behind Lotus Health Group and Anhui Jianghuai Automobile 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 My Watchlist Analysis module to analyze my current watchlist and to refresh optimization strategy. Macroaxis watchlist is based on self-learning algorithm to remember stocks you like.
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