Correlation Between Chengdu B-ray and Aofu Environmental
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By analyzing existing cross correlation between Chengdu B ray Media and Aofu Environmental Technology, you can compare the effects of market volatilities on Chengdu B-ray and Aofu Environmental 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 Chengdu B-ray with a short position of Aofu Environmental. Check out your portfolio center. Please also check ongoing floating volatility patterns of Chengdu B-ray and Aofu Environmental.
Diversification Opportunities for Chengdu B-ray and Aofu Environmental
0.48 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Chengdu and Aofu is 0.48. Overlapping area represents the amount of risk that can be diversified away by holding Chengdu B ray Media and Aofu Environmental Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Aofu Environmental and Chengdu B-ray 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 Chengdu B ray Media are associated (or correlated) with Aofu Environmental. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Aofu Environmental has no effect on the direction of Chengdu B-ray i.e., Chengdu B-ray and Aofu Environmental go up and down completely randomly.
Pair Corralation between Chengdu B-ray and Aofu Environmental
Assuming the 90 days trading horizon Chengdu B ray Media is expected to generate 0.95 times more return on investment than Aofu Environmental. However, Chengdu B ray Media is 1.05 times less risky than Aofu Environmental. It trades about 0.04 of its potential returns per unit of risk. Aofu Environmental Technology is currently generating about 0.02 per unit of risk. If you would invest 379.00 in Chengdu B ray Media on November 3, 2024 and sell it today you would earn a total of 70.00 from holding Chengdu B ray Media or generate 18.47% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Chengdu B ray Media vs. Aofu Environmental Technology
Performance |
| Timeline |
| Chengdu B ray |
| Aofu Environmental |
Chengdu B-ray and Aofu Environmental Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Chengdu B-ray and Aofu Environmental
The main advantage of trading using opposite Chengdu B-ray and Aofu Environmental positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Chengdu B-ray position performs unexpectedly, Aofu Environmental 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 Aofu Environmental will offset losses from the drop in Aofu Environmental's long position.| Chengdu B-ray vs. Guangdong Sunwill Precising | Chengdu B-ray vs. Shengda Mining Co | Chengdu B-ray vs. Jilin OLED Material | Chengdu B-ray vs. Malion New Materials |
| Aofu Environmental vs. Guangxi Wuzhou Communications | Aofu Environmental vs. Shanghai Ziyan Foods | Aofu Environmental vs. TianJin 712 Communication | Aofu Environmental vs. Suzhou Weizhixiang Food |
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 Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
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