Correlation Between Anhui Jianghuai and Zhengping RoadBridge
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By analyzing existing cross correlation between Anhui Jianghuai Automobile and Zhengping RoadBridge Constr, you can compare the effects of market volatilities on Anhui Jianghuai and Zhengping RoadBridge 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 Zhengping RoadBridge. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Jianghuai and Zhengping RoadBridge.
Diversification Opportunities for Anhui Jianghuai and Zhengping RoadBridge
0.14 | Correlation Coefficient |
Average diversification
The 3 months correlation between Anhui and Zhengping is 0.14. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Jianghuai Automobile and Zhengping RoadBridge Constr in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Zhengping RoadBridge 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 Zhengping RoadBridge. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Zhengping RoadBridge has no effect on the direction of Anhui Jianghuai i.e., Anhui Jianghuai and Zhengping RoadBridge go up and down completely randomly.
Pair Corralation between Anhui Jianghuai and Zhengping RoadBridge
Assuming the 90 days trading horizon Anhui Jianghuai Automobile is expected to generate 0.84 times more return on investment than Zhengping RoadBridge. However, Anhui Jianghuai Automobile is 1.19 times less risky than Zhengping RoadBridge. It trades about 0.12 of its potential returns per unit of risk. Zhengping RoadBridge Constr is currently generating about 0.03 per unit of risk. If you would invest 1,390 in Anhui Jianghuai Automobile on October 14, 2024 and sell it today you would earn a total of 2,135 from holding Anhui Jianghuai Automobile or generate 153.6% 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. Zhengping RoadBridge Constr
Performance |
| Timeline |
| Anhui Jianghuai Auto |
| Zhengping RoadBridge |
Anhui Jianghuai and Zhengping RoadBridge Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Jianghuai and Zhengping RoadBridge
The main advantage of trading using opposite Anhui Jianghuai and Zhengping RoadBridge positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Jianghuai position performs unexpectedly, Zhengping RoadBridge 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 Zhengping RoadBridge will offset losses from the drop in Zhengping RoadBridge's long position.| Anhui Jianghuai vs. Tianjin Silvery Dragon | Anhui Jianghuai vs. Jinhui Mining Co | Anhui Jianghuai vs. GreenTech Environmental Co | Anhui Jianghuai vs. Xinjiang Baodi Mining |
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 Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
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