Correlation Between Anhui Jianghuai and Guangxi Wuzhou
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By analyzing existing cross correlation between Anhui Jianghuai Automobile and Guangxi Wuzhou Communications, you can compare the effects of market volatilities on Anhui Jianghuai and Guangxi Wuzhou 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 Guangxi Wuzhou. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Jianghuai and Guangxi Wuzhou.
Diversification Opportunities for Anhui Jianghuai and Guangxi Wuzhou
0.22 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Anhui and Guangxi is 0.22. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Jianghuai Automobile and Guangxi Wuzhou Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Guangxi Wuzhou Commu 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 Guangxi Wuzhou. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Guangxi Wuzhou Commu has no effect on the direction of Anhui Jianghuai i.e., Anhui Jianghuai and Guangxi Wuzhou go up and down completely randomly.
Pair Corralation between Anhui Jianghuai and Guangxi Wuzhou
Assuming the 90 days trading horizon Anhui Jianghuai Automobile is expected to under-perform the Guangxi Wuzhou. But the stock apears to be less risky and, when comparing its historical volatility, Anhui Jianghuai Automobile is 2.57 times less risky than Guangxi Wuzhou. The stock trades about -0.21 of its potential returns per unit of risk. The Guangxi Wuzhou Communications is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 405.00 in Guangxi Wuzhou Communications on October 12, 2024 and sell it today you would earn a total of 30.00 from holding Guangxi Wuzhou Communications or generate 7.41% 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. Guangxi Wuzhou Communications
Performance |
| Timeline |
| Anhui Jianghuai Auto |
| Guangxi Wuzhou Commu |
Anhui Jianghuai and Guangxi Wuzhou Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Jianghuai and Guangxi Wuzhou
The main advantage of trading using opposite Anhui Jianghuai and Guangxi Wuzhou positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Jianghuai position performs unexpectedly, Guangxi Wuzhou 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 Guangxi Wuzhou will offset losses from the drop in Guangxi Wuzhou's long position.| Anhui Jianghuai vs. Changchun Engley Automobile | Anhui Jianghuai vs. King Strong New Material | Anhui Jianghuai vs. Western Metal Materials | Anhui Jianghuai vs. Guangzhou Tinci Materials |
| Guangxi Wuzhou vs. Telling Telecommunication Holding | Guangxi Wuzhou vs. Fujian Oriental Silver | Guangxi Wuzhou vs. Quectel Wireless Solutions | Guangxi Wuzhou vs. Allwin Telecommunication Co |
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 Global Correlations module to find global opportunities by holding instruments from different markets.
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