Correlation Between Anhui Jianghuai and Ningbo Homelink
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By analyzing existing cross correlation between Anhui Jianghuai Automobile and Ningbo Homelink Eco iTech, you can compare the effects of market volatilities on Anhui Jianghuai and Ningbo Homelink 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 Ningbo Homelink. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Jianghuai and Ningbo Homelink.
Diversification Opportunities for Anhui Jianghuai and Ningbo Homelink
0.27 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Anhui and Ningbo is 0.27. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Jianghuai Automobile and Ningbo Homelink Eco iTech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningbo Homelink Eco 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 Ningbo Homelink. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningbo Homelink Eco has no effect on the direction of Anhui Jianghuai i.e., Anhui Jianghuai and Ningbo Homelink go up and down completely randomly.
Pair Corralation between Anhui Jianghuai and Ningbo Homelink
Assuming the 90 days trading horizon Anhui Jianghuai Automobile is expected to generate 1.32 times more return on investment than Ningbo Homelink. However, Anhui Jianghuai is 1.32 times more volatile than Ningbo Homelink Eco iTech. It trades about 0.06 of its potential returns per unit of risk. Ningbo Homelink Eco iTech is currently generating about -0.02 per unit of risk. If you would invest 1,621 in Anhui Jianghuai Automobile on October 14, 2024 and sell it today you would earn a total of 1,904 from holding Anhui Jianghuai Automobile or generate 117.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Jianghuai Automobile vs. Ningbo Homelink Eco iTech
Performance |
| Timeline |
| Anhui Jianghuai Auto |
| Ningbo Homelink Eco |
Anhui Jianghuai and Ningbo Homelink Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Jianghuai and Ningbo Homelink
The main advantage of trading using opposite Anhui Jianghuai and Ningbo Homelink positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Jianghuai position performs unexpectedly, Ningbo Homelink 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 Ningbo Homelink will offset losses from the drop in Ningbo Homelink's long position.| Anhui Jianghuai vs. Tianjin Silvery Dragon | Anhui Jianghuai vs. Jinhui Mining Co | Anhui Jianghuai vs. GreenTech Environmental Co | Anhui Jianghuai vs. Xinjiang Baodi Mining |
| Ningbo Homelink vs. Anhui Jianghuai Automobile | Ningbo Homelink vs. TongFu Microelectronics Co | Ningbo Homelink vs. Shenzhen Clou Electronics | Ningbo Homelink vs. Fiberhome Telecommunication Technologies |
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 Stocks Directory module to find actively traded stocks across global markets.
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