Correlation Between Anhui Jianghuai and Kunshan Guoli
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By analyzing existing cross correlation between Anhui Jianghuai Automobile and Kunshan Guoli Electronic, you can compare the effects of market volatilities on Anhui Jianghuai and Kunshan Guoli 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 Kunshan Guoli. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Jianghuai and Kunshan Guoli.
Diversification Opportunities for Anhui Jianghuai and Kunshan Guoli
0.95 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Anhui and Kunshan is 0.95. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Jianghuai Automobile and Kunshan Guoli Electronic in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Kunshan Guoli Electronic 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 Kunshan Guoli. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Kunshan Guoli Electronic has no effect on the direction of Anhui Jianghuai i.e., Anhui Jianghuai and Kunshan Guoli go up and down completely randomly.
Pair Corralation between Anhui Jianghuai and Kunshan Guoli
Assuming the 90 days trading horizon Anhui Jianghuai Automobile is expected to generate 1.18 times more return on investment than Kunshan Guoli. However, Anhui Jianghuai is 1.18 times more volatile than Kunshan Guoli Electronic. It trades about 0.13 of its potential returns per unit of risk. Kunshan Guoli Electronic is currently generating about -0.06 per unit of risk. If you would invest 3,455 in Anhui Jianghuai Automobile on August 28, 2024 and sell it today you would earn a total of 436.00 from holding Anhui Jianghuai Automobile or generate 12.62% 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. Kunshan Guoli Electronic
Performance |
| Timeline |
| Anhui Jianghuai Auto |
| Kunshan Guoli Electronic |
Anhui Jianghuai and Kunshan Guoli Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Jianghuai and Kunshan Guoli
The main advantage of trading using opposite Anhui Jianghuai and Kunshan Guoli positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Jianghuai position performs unexpectedly, Kunshan Guoli 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 Kunshan Guoli will offset losses from the drop in Kunshan Guoli'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 |
| Kunshan Guoli vs. Nanjing Putian Telecommunications | Kunshan Guoli vs. Shenzhen Hifuture Electric | Kunshan Guoli vs. Shenyang Huitian Thermal | Kunshan Guoli vs. Jiangsu Xinning Modern |
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 FinTech Suite module to use AI to screen and filter profitable investment opportunities.
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