Correlation Between Agricultural Bank and Dazhong Transportation
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By analyzing existing cross correlation between Agricultural Bank of and Dazhong Transportation Group, you can compare the effects of market volatilities on Agricultural Bank and Dazhong Transportation 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 Dazhong Transportation. Check out your portfolio center. Please also check ongoing floating volatility patterns of Agricultural Bank and Dazhong Transportation.
Diversification Opportunities for Agricultural Bank and Dazhong Transportation
-0.71 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Agricultural and Dazhong is -0.71. Overlapping area represents the amount of risk that can be diversified away by holding Agricultural Bank of and Dazhong Transportation Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dazhong Transportation 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 Dazhong Transportation. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dazhong Transportation has no effect on the direction of Agricultural Bank i.e., Agricultural Bank and Dazhong Transportation go up and down completely randomly.
Pair Corralation between Agricultural Bank and Dazhong Transportation
Assuming the 90 days trading horizon Agricultural Bank of is expected to generate 0.49 times more return on investment than Dazhong Transportation. However, Agricultural Bank of is 2.02 times less risky than Dazhong Transportation. It trades about 0.1 of its potential returns per unit of risk. Dazhong Transportation Group is currently generating about 0.01 per unit of risk. If you would invest 274.00 in Agricultural Bank of on October 28, 2024 and sell it today you would earn a total of 230.00 from holding Agricultural Bank of or generate 83.94% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Agricultural Bank of vs. Dazhong Transportation Group
Performance |
| Timeline |
| Agricultural Bank |
| Dazhong Transportation |
Agricultural Bank and Dazhong Transportation Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Agricultural Bank and Dazhong Transportation
The main advantage of trading using opposite Agricultural Bank and Dazhong Transportation positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Agricultural Bank position performs unexpectedly, Dazhong Transportation 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 Dazhong Transportation will offset losses from the drop in Dazhong Transportation's long position.| Agricultural Bank vs. Industrial and Commercial | Agricultural Bank vs. China Construction Bank | Agricultural Bank vs. Bank of China | Agricultural Bank 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 Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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