Correlation Between Anhui Jianghuai and Citic Guoan
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By analyzing existing cross correlation between Anhui Jianghuai Automobile and Citic Guoan Wine, you can compare the effects of market volatilities on Anhui Jianghuai and Citic Guoan 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 Citic Guoan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Jianghuai and Citic Guoan.
Diversification Opportunities for Anhui Jianghuai and Citic Guoan
0.13 | Correlation Coefficient |
Average diversification
The 3 months correlation between Anhui and Citic is 0.13. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Jianghuai Automobile and Citic Guoan Wine in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Citic Guoan Wine 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 Citic Guoan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Citic Guoan Wine has no effect on the direction of Anhui Jianghuai i.e., Anhui Jianghuai and Citic Guoan go up and down completely randomly.
Pair Corralation between Anhui Jianghuai and Citic Guoan
Assuming the 90 days trading horizon Anhui Jianghuai Automobile is expected to generate 1.41 times more return on investment than Citic Guoan. However, Anhui Jianghuai is 1.41 times more volatile than Citic Guoan Wine. It trades about 0.07 of its potential returns per unit of risk. Citic Guoan Wine is currently generating about -0.03 per unit of risk. If you would invest 1,681 in Anhui Jianghuai Automobile on October 28, 2024 and sell it today you would earn a total of 2,530 from holding Anhui Jianghuai Automobile or generate 150.51% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Jianghuai Automobile vs. Citic Guoan Wine
Performance |
| Timeline |
| Anhui Jianghuai Auto |
| Citic Guoan Wine |
Anhui Jianghuai and Citic Guoan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Jianghuai and Citic Guoan
The main advantage of trading using opposite Anhui Jianghuai and Citic Guoan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Jianghuai position performs unexpectedly, Citic Guoan 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 Citic Guoan will offset losses from the drop in Citic Guoan's long position.| Anhui Jianghuai vs. Techshine Electronics Co | Anhui Jianghuai vs. Ningxia Younglight Chemicals | Anhui Jianghuai vs. HaiXin Foods Co | Anhui Jianghuai vs. Integrated Electronic Systems |
| Citic Guoan vs. Chengdu Kanghua Biological | Citic Guoan vs. Beijing Wantai Biological | Citic Guoan vs. Suzhou Novoprotein Scientific | Citic Guoan vs. Aluminum Corp of |
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 Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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