Correlation Between Anhui Jianghuai and Aurora Optoelectronics
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By analyzing existing cross correlation between Anhui Jianghuai Automobile and Aurora Optoelectronics Co, you can compare the effects of market volatilities on Anhui Jianghuai and Aurora Optoelectronics 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 Aurora Optoelectronics. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Jianghuai and Aurora Optoelectronics.
Diversification Opportunities for Anhui Jianghuai and Aurora Optoelectronics
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Anhui and Aurora is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Jianghuai Automobile and Aurora Optoelectronics Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aurora Optoelectronics 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 Aurora Optoelectronics. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aurora Optoelectronics has no effect on the direction of Anhui Jianghuai i.e., Anhui Jianghuai and Aurora Optoelectronics go up and down completely randomly.
Pair Corralation between Anhui Jianghuai and Aurora Optoelectronics
Assuming the 90 days trading horizon Anhui Jianghuai Automobile is expected to under-perform the Aurora Optoelectronics. But the stock apears to be less risky and, when comparing its historical volatility, Anhui Jianghuai Automobile is 1.14 times less risky than Aurora Optoelectronics. The stock trades about -0.05 of its potential returns per unit of risk. The Aurora Optoelectronics Co is currently generating about 0.13 of returns per unit of risk over similar time horizon. If you would invest 223.00 in Aurora Optoelectronics Co on September 2, 2024 and sell it today you would earn a total of 27.00 from holding Aurora Optoelectronics Co or generate 12.11% 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. Aurora Optoelectronics Co
Performance |
| Timeline |
| Anhui Jianghuai Auto |
| Aurora Optoelectronics |
Anhui Jianghuai and Aurora Optoelectronics Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Jianghuai and Aurora Optoelectronics
The main advantage of trading using opposite Anhui Jianghuai and Aurora Optoelectronics positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Jianghuai position performs unexpectedly, Aurora Optoelectronics 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 Aurora Optoelectronics will offset losses from the drop in Aurora Optoelectronics' long position.| Anhui Jianghuai vs. Biwin Storage Technology | Anhui Jianghuai vs. PetroChina Co Ltd | Anhui Jianghuai vs. Industrial and Commercial | Anhui Jianghuai vs. China Construction Bank |
| Aurora Optoelectronics vs. Zotye Automobile Co | Aurora Optoelectronics vs. Guangzhou Haige Communications | Aurora Optoelectronics vs. Gan Yuan Foods | Aurora Optoelectronics vs. Anhui Jianghuai Automobile |
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 Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.
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