Correlation Between Gansu Jiu and AVCON Information
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By analyzing existing cross correlation between Gansu Jiu Steel and AVCON Information Tech, you can compare the effects of market volatilities on Gansu Jiu and AVCON Information 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 Gansu Jiu with a short position of AVCON Information. Check out your portfolio center. Please also check ongoing floating volatility patterns of Gansu Jiu and AVCON Information.
Diversification Opportunities for Gansu Jiu and AVCON Information
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Gansu and AVCON is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Gansu Jiu Steel and AVCON Information Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AVCON Information Tech and Gansu Jiu 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 Gansu Jiu Steel are associated (or correlated) with AVCON Information. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AVCON Information Tech has no effect on the direction of Gansu Jiu i.e., Gansu Jiu and AVCON Information go up and down completely randomly.
Pair Corralation between Gansu Jiu and AVCON Information
Assuming the 90 days trading horizon Gansu Jiu is expected to generate 1.42 times less return on investment than AVCON Information. But when comparing it to its historical volatility, Gansu Jiu Steel is 1.79 times less risky than AVCON Information. It trades about 0.04 of its potential returns per unit of risk. AVCON Information Tech is currently generating about 0.03 of returns per unit of risk over similar time horizon. If you would invest 428.00 in AVCON Information Tech on September 12, 2024 and sell it today you would earn a total of 62.00 from holding AVCON Information Tech or generate 14.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Gansu Jiu Steel vs. AVCON Information Tech
Performance |
| Timeline |
| Gansu Jiu Steel |
| AVCON Information Tech |
Gansu Jiu and AVCON Information Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Gansu Jiu and AVCON Information
The main advantage of trading using opposite Gansu Jiu and AVCON Information positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Gansu Jiu position performs unexpectedly, AVCON Information 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 AVCON Information will offset losses from the drop in AVCON Information's long position.| Gansu Jiu vs. Zijin Mining Group | Gansu Jiu vs. Wanhua Chemical Group | Gansu Jiu vs. Baoshan Iron Steel | Gansu Jiu vs. Rongsheng Petrochemical Co |
| AVCON Information vs. Gansu Jiu Steel | AVCON Information vs. Shandong Mining Machinery | AVCON Information vs. Aba Chemicals Corp | AVCON Information vs. BlueFocus Communication 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 Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
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