Correlation Between Agricultural Bank and Allied Machinery
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By analyzing existing cross correlation between Agricultural Bank of and Allied Machinery Co, you can compare the effects of market volatilities on Agricultural Bank and Allied Machinery 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 Allied Machinery. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agricultural Bank and Allied Machinery.
Diversification Opportunities for Agricultural Bank and Allied Machinery
0.49 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Agricultural and Allied is 0.49. Overlapping area represents the amount of risk that can be diversified away by holding Agricultural Bank of and Allied Machinery Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Allied Machinery 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 Allied Machinery. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Allied Machinery has no effect on the direction of Agricultural Bank i.e., Agricultural Bank and Allied Machinery go up and down completely randomly.
Pair Corralation between Agricultural Bank and Allied Machinery
Assuming the 90 days trading horizon Agricultural Bank of is expected to under-perform the Allied Machinery. But the stock apears to be less risky and, when comparing its historical volatility, Agricultural Bank of is 2.04 times less risky than Allied Machinery. The stock trades about -0.02 of its potential returns per unit of risk. The Allied Machinery Co is currently generating about 0.25 of returns per unit of risk over similar time horizon. If you would invest 1,372 in Allied Machinery Co on September 13, 2024 and sell it today you would earn a total of 347.00 from holding Allied Machinery Co or generate 25.29% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agricultural Bank of vs. Allied Machinery Co
Performance |
| Timeline |
| Agricultural Bank |
| Allied Machinery |
Agricultural Bank and Allied Machinery Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agricultural Bank and Allied Machinery
The main advantage of trading using opposite Agricultural Bank and Allied Machinery positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agricultural Bank position performs unexpectedly, Allied Machinery 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 Allied Machinery will offset losses from the drop in Allied Machinery's long position.| Agricultural Bank vs. Industrial and Commercial | Agricultural Bank vs. China Construction Bank | Agricultural Bank vs. Bank of China | Agricultural Bank vs. PetroChina Co Ltd |
| Allied Machinery vs. Industrial and Commercial | Allied Machinery vs. Kweichow Moutai Co | Allied Machinery vs. Agricultural Bank of | Allied Machinery vs. China Mobile Limited |
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 File Import module to quickly import all of your third-party portfolios from your local drive in csv format.
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