Correlation Between Industrial Bank and AECC Aviation
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By analyzing existing cross correlation between Industrial Bank Co and AECC Aviation Power, you can compare the effects of market volatilities on Industrial Bank and AECC Aviation 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 Industrial Bank with a short position of AECC Aviation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Industrial Bank and AECC Aviation.
Diversification Opportunities for Industrial Bank and AECC Aviation
-0.58 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between Industrial and AECC is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Industrial Bank Co and AECC Aviation Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on AECC Aviation Power and Industrial Bank 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 Industrial Bank Co are associated (or correlated) with AECC Aviation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of AECC Aviation Power has no effect on the direction of Industrial Bank i.e., Industrial Bank and AECC Aviation go up and down completely randomly.
Pair Corralation between Industrial Bank and AECC Aviation
Assuming the 90 days trading horizon Industrial Bank Co is expected to generate 0.79 times more return on investment than AECC Aviation. However, Industrial Bank Co is 1.27 times less risky than AECC Aviation. It trades about 0.32 of its potential returns per unit of risk. AECC Aviation Power is currently generating about -0.26 per unit of risk. If you would invest 1,892 in Industrial Bank Co on November 3, 2024 and sell it today you would earn a total of 139.00 from holding Industrial Bank Co or generate 7.35% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Industrial Bank Co vs. AECC Aviation Power
Performance |
| Timeline |
| Industrial Bank |
| AECC Aviation Power |
Industrial Bank and AECC Aviation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Industrial Bank and AECC Aviation
The main advantage of trading using opposite Industrial Bank and AECC Aviation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Industrial Bank position performs unexpectedly, AECC Aviation 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 AECC Aviation will offset losses from the drop in AECC Aviation's long position.| Industrial Bank vs. Sharetronic Data Technology | Industrial Bank vs. Sinofibers Technology Co | Industrial Bank vs. Bank of Suzhou | Industrial Bank vs. Xiamen Bank Co |
| AECC Aviation vs. Wuxi Double Elephant | AECC Aviation vs. Luyin Investment Group | AECC Aviation vs. Zhejiang Construction Investment | AECC Aviation vs. Postal Savings Bank |
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 Portfolio Backtesting module to avoid under-diversification and over-optimization by backtesting your portfolios.
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