Correlation Between Anhui Jianghuai and Hengli Industrial
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By analyzing existing cross correlation between Anhui Jianghuai Automobile and Hengli Industrial Development, you can compare the effects of market volatilities on Anhui Jianghuai and Hengli Industrial 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 Hengli Industrial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Jianghuai and Hengli Industrial.
Diversification Opportunities for Anhui Jianghuai and Hengli Industrial
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Anhui and Hengli is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Jianghuai Automobile and Hengli Industrial Development in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Hengli Industrial 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 Hengli Industrial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Hengli Industrial has no effect on the direction of Anhui Jianghuai i.e., Anhui Jianghuai and Hengli Industrial go up and down completely randomly.
Pair Corralation between Anhui Jianghuai and Hengli Industrial
Assuming the 90 days trading horizon Anhui Jianghuai Automobile is expected to generate 1.07 times more return on investment than Hengli Industrial. However, Anhui Jianghuai is 1.07 times more volatile than Hengli Industrial Development. It trades about 0.07 of its potential returns per unit of risk. Hengli Industrial Development is currently generating about -0.03 per unit of risk. If you would invest 1,443 in Anhui Jianghuai Automobile on October 9, 2024 and sell it today you would earn a total of 2,057 from holding Anhui Jianghuai Automobile or generate 142.55% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Jianghuai Automobile vs. Hengli Industrial Development
Performance |
| Timeline |
| Anhui Jianghuai Auto |
| Hengli Industrial |
Anhui Jianghuai and Hengli Industrial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Jianghuai and Hengli Industrial
The main advantage of trading using opposite Anhui Jianghuai and Hengli Industrial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Jianghuai position performs unexpectedly, Hengli Industrial 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 Hengli Industrial will offset losses from the drop in Hengli Industrial's long position.| Anhui Jianghuai vs. Chengdu Kanghua Biological | Anhui Jianghuai vs. Beijing Wantai Biological | Anhui Jianghuai vs. Suzhou Novoprotein Scientific | Anhui Jianghuai vs. Aluminum Corp of |
| Hengli Industrial vs. Ming Yang Smart | Hengli Industrial vs. 159681 | Hengli Industrial vs. 159005 | Hengli Industrial vs. Loctek Ergonomic Technology |
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 Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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