Correlation Between Agricultural Bank and Beijing Sanyuan
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By analyzing existing cross correlation between Agricultural Bank of and Beijing Sanyuan Foods, you can compare the effects of market volatilities on Agricultural Bank and Beijing Sanyuan 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 Beijing Sanyuan. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agricultural Bank and Beijing Sanyuan.
Diversification Opportunities for Agricultural Bank and Beijing Sanyuan
0.28 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Agricultural and Beijing is 0.28. Overlapping area represents the amount of risk that can be diversified away by holding Agricultural Bank of and Beijing Sanyuan Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Beijing Sanyuan Foods 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 Beijing Sanyuan. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Beijing Sanyuan Foods has no effect on the direction of Agricultural Bank i.e., Agricultural Bank and Beijing Sanyuan go up and down completely randomly.
Pair Corralation between Agricultural Bank and Beijing Sanyuan
Assuming the 90 days trading horizon Agricultural Bank of is expected to generate 0.56 times more return on investment than Beijing Sanyuan. However, Agricultural Bank of is 1.79 times less risky than Beijing Sanyuan. It trades about 0.05 of its potential returns per unit of risk. Beijing Sanyuan Foods is currently generating about -0.5 per unit of risk. If you would invest 503.00 in Agricultural Bank of on October 13, 2024 and sell it today you would earn a total of 7.00 from holding Agricultural Bank of or generate 1.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agricultural Bank of vs. Beijing Sanyuan Foods
Performance |
| Timeline |
| Agricultural Bank |
| Beijing Sanyuan Foods |
Agricultural Bank and Beijing Sanyuan Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agricultural Bank and Beijing Sanyuan
The main advantage of trading using opposite Agricultural Bank and Beijing Sanyuan positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agricultural Bank position performs unexpectedly, Beijing Sanyuan 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 Beijing Sanyuan will offset losses from the drop in Beijing Sanyuan's long position.The idea behind Agricultural Bank of and Beijing Sanyuan Foods 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.
| Beijing Sanyuan vs. Industrial and Commercial | Beijing Sanyuan vs. Agricultural Bank of | Beijing Sanyuan vs. China Construction Bank | Beijing Sanyuan vs. Bank of China |
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 Cryptocurrency Center module to build and monitor diversified portfolio of extremely risky digital assets and cryptocurrency.
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