Correlation Between Anhui Jianghuai and Chahua Modern
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By analyzing existing cross correlation between Anhui Jianghuai Automobile and Chahua Modern Housewares, you can compare the effects of market volatilities on Anhui Jianghuai and Chahua Modern 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 Chahua Modern. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Jianghuai and Chahua Modern.
Diversification Opportunities for Anhui Jianghuai and Chahua Modern
0.11 | Correlation Coefficient |
Average diversification
The 3 months correlation between Anhui and Chahua is 0.11. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Jianghuai Automobile and Chahua Modern Housewares in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Chahua Modern Housewares 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 Chahua Modern. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Chahua Modern Housewares has no effect on the direction of Anhui Jianghuai i.e., Anhui Jianghuai and Chahua Modern go up and down completely randomly.
Pair Corralation between Anhui Jianghuai and Chahua Modern
Assuming the 90 days trading horizon Anhui Jianghuai Automobile is expected to generate 0.89 times more return on investment than Chahua Modern. However, Anhui Jianghuai Automobile is 1.12 times less risky than Chahua Modern. It trades about 0.14 of its potential returns per unit of risk. Chahua Modern Housewares is currently generating about 0.05 per unit of risk. If you would invest 3,511 in Anhui Jianghuai Automobile on October 30, 2024 and sell it today you would earn a total of 578.00 from holding Anhui Jianghuai Automobile or generate 16.46% 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. Chahua Modern Housewares
Performance |
Timeline |
Anhui Jianghuai Auto |
Chahua Modern Housewares |
Anhui Jianghuai and Chahua Modern Volatility Contrast
Predicted Return Density |
Returns |
Pair Trading with Anhui Jianghuai and Chahua Modern
The main advantage of trading using opposite Anhui Jianghuai and Chahua Modern positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Jianghuai position performs unexpectedly, Chahua Modern 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 Chahua Modern will offset losses from the drop in Chahua Modern's long position.Anhui Jianghuai vs. China Longyuan Power | Anhui Jianghuai vs. PetroChina Co Ltd | Anhui Jianghuai vs. Guangxi Guiguan Electric | Anhui Jianghuai vs. Yantai North Andre |
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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 Options Analysis module to analyze and evaluate options and option chains as a potential hedge for your portfolios.
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