Correlation Between Anhui Jianghuai and Xiamen Bank
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By analyzing existing cross correlation between Anhui Jianghuai Automobile and Xiamen Bank Co, you can compare the effects of market volatilities on Anhui Jianghuai and Xiamen Bank 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 Xiamen Bank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Jianghuai and Xiamen Bank.
Diversification Opportunities for Anhui Jianghuai and Xiamen Bank
0.59 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Anhui and Xiamen is 0.59. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Jianghuai Automobile and Xiamen Bank Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xiamen Bank 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 Xiamen Bank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xiamen Bank has no effect on the direction of Anhui Jianghuai i.e., Anhui Jianghuai and Xiamen Bank go up and down completely randomly.
Pair Corralation between Anhui Jianghuai and Xiamen Bank
Assuming the 90 days trading horizon Anhui Jianghuai Automobile is expected to generate 2.36 times more return on investment than Xiamen Bank. However, Anhui Jianghuai is 2.36 times more volatile than Xiamen Bank Co. It trades about 0.14 of its potential returns per unit of risk. Xiamen Bank Co is currently generating about 0.04 per unit of risk. If you would invest 1,622 in Anhui Jianghuai Automobile on August 25, 2024 and sell it today you would earn a total of 2,263 from holding Anhui Jianghuai Automobile or generate 139.52% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Jianghuai Automobile vs. Xiamen Bank Co
Performance |
| Timeline |
| Anhui Jianghuai Auto |
| Xiamen Bank |
Anhui Jianghuai and Xiamen Bank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Jianghuai and Xiamen Bank
The main advantage of trading using opposite Anhui Jianghuai and Xiamen Bank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Jianghuai position performs unexpectedly, Xiamen Bank 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 Xiamen Bank will offset losses from the drop in Xiamen Bank's long position.| Anhui Jianghuai vs. Lutian Machinery Co | Anhui Jianghuai vs. China Longyuan Power | Anhui Jianghuai vs. Changshu Tongrun Auto | Anhui Jianghuai vs. PetroChina Co Ltd |
| Xiamen Bank vs. China Life Insurance | Xiamen Bank vs. Piotech Inc A | Xiamen Bank vs. Dongxing Sec Co | Xiamen Bank vs. Shanghai OPM Biosciences |
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 Technical Analysis module to check basic technical indicators and analysis based on most latest market data.
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