Correlation Between Metro Investment and Anhui Transport
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By analyzing existing cross correlation between Metro Investment Development and Anhui Transport Consulting, you can compare the effects of market volatilities on Metro Investment and Anhui Transport 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 Metro Investment with a short position of Anhui Transport. Check out your portfolio center. Please also check ongoing floating volatility patterns of Metro Investment and Anhui Transport.
Diversification Opportunities for Metro Investment and Anhui Transport
0.83 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Metro and Anhui is 0.83. Overlapping area represents the amount of risk that can be diversified away by holding Metro Investment Development and Anhui Transport Consulting in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Anhui Transport Cons and Metro Investment 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 Metro Investment Development are associated (or correlated) with Anhui Transport. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Anhui Transport Cons has no effect on the direction of Metro Investment i.e., Metro Investment and Anhui Transport go up and down completely randomly.
Pair Corralation between Metro Investment and Anhui Transport
Assuming the 90 days trading horizon Metro Investment Development is expected to under-perform the Anhui Transport. In addition to that, Metro Investment is 1.18 times more volatile than Anhui Transport Consulting. It trades about -0.1 of its total potential returns per unit of risk. Anhui Transport Consulting is currently generating about 0.03 per unit of volatility. If you would invest 934.00 in Anhui Transport Consulting on August 29, 2024 and sell it today you would earn a total of 18.00 from holding Anhui Transport Consulting or generate 1.93% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Metro Investment Development vs. Anhui Transport Consulting
Performance |
| Timeline |
| Metro Investment Dev |
| Anhui Transport Cons |
Metro Investment and Anhui Transport Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Metro Investment and Anhui Transport
The main advantage of trading using opposite Metro Investment and Anhui Transport positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Metro Investment position performs unexpectedly, Anhui Transport 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 Anhui Transport will offset losses from the drop in Anhui Transport's long position.| Metro Investment vs. Sinocelltech Group | Metro Investment vs. Jiujiang Shanshui Technology | Metro Investment vs. Fujian Newland Computer | Metro Investment vs. Changchun UP Optotech |
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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