Correlation Between Agricultural Bank and China Tianying
Specify exactly 2 symbols:
By analyzing existing cross correlation between Agricultural Bank of and China Tianying, you can compare the effects of market volatilities on Agricultural Bank and China Tianying 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 Agricultural Bank with a short position of China Tianying. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agricultural Bank and China Tianying.
Diversification Opportunities for Agricultural Bank and China Tianying
-0.4 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Agricultural and China is -0.4. Overlapping area represents the amount of risk that can be diversified away by holding Agricultural Bank of and China Tianying in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on China Tianying and Agricultural 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 Agricultural Bank of are associated (or correlated) with China Tianying. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of China Tianying has no effect on the direction of Agricultural Bank i.e., Agricultural Bank and China Tianying go up and down completely randomly.
Pair Corralation between Agricultural Bank and China Tianying
Assuming the 90 days trading horizon Agricultural Bank of is expected to generate 0.5 times more return on investment than China Tianying. However, Agricultural Bank of is 2.02 times less risky than China Tianying. It trades about 0.09 of its potential returns per unit of risk. China Tianying is currently generating about 0.02 per unit of risk. If you would invest 371.00 in Agricultural Bank of on November 9, 2024 and sell it today you would earn a total of 133.00 from holding Agricultural Bank of or generate 35.85% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agricultural Bank of vs. China Tianying
Performance |
| Timeline |
| Agricultural Bank |
Risk-Adjusted Performance
OK
Weak | Strong |
| China Tianying |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Agricultural Bank and China Tianying Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agricultural Bank and China Tianying
The main advantage of trading using opposite Agricultural Bank and China Tianying positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agricultural Bank position performs unexpectedly, China Tianying 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 China Tianying will offset losses from the drop in China Tianying's long position.The idea behind Agricultural Bank of and China Tianying pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.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 Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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