Correlation Between Anhui Jianghuai and North Huajin
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By analyzing existing cross correlation between Anhui Jianghuai Automobile and North Huajin Chemical, you can compare the effects of market volatilities on Anhui Jianghuai and North Huajin 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 Anhui Jianghuai with a short position of North Huajin. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Jianghuai and North Huajin.
Diversification Opportunities for Anhui Jianghuai and North Huajin
0.91 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Anhui and North is 0.91. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Jianghuai Automobile and North Huajin Chemical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on North Huajin Chemical and Anhui Jianghuai 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 Anhui Jianghuai Automobile are associated (or correlated) with North Huajin. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of North Huajin Chemical has no effect on the direction of Anhui Jianghuai i.e., Anhui Jianghuai and North Huajin go up and down completely randomly.
Pair Corralation between Anhui Jianghuai and North Huajin
Assuming the 90 days trading horizon Anhui Jianghuai Automobile is expected to generate 1.38 times more return on investment than North Huajin. However, Anhui Jianghuai is 1.38 times more volatile than North Huajin Chemical. It trades about 0.16 of its potential returns per unit of risk. North Huajin Chemical is currently generating about 0.02 per unit of risk. If you would invest 1,592 in Anhui Jianghuai Automobile on September 3, 2024 and sell it today you would earn a total of 1,919 from holding Anhui Jianghuai Automobile or generate 120.54% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Jianghuai Automobile vs. North Huajin Chemical
Performance |
| Timeline |
| Anhui Jianghuai Auto |
| North Huajin Chemical |
Anhui Jianghuai and North Huajin Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Jianghuai and North Huajin
The main advantage of trading using opposite Anhui Jianghuai and North Huajin positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Jianghuai position performs unexpectedly, North Huajin 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 North Huajin will offset losses from the drop in North Huajin's long position.| Anhui Jianghuai vs. PetroChina Co Ltd | Anhui Jianghuai vs. China Mobile Limited | Anhui Jianghuai vs. Industrial and Commercial | Anhui Jianghuai vs. China Life Insurance |
| North Huajin vs. Zijin Mining Group | North Huajin vs. Baoshan Iron Steel | North Huajin vs. Rongsheng Petrochemical Co | North Huajin vs. Hoshine Silicon Ind |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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