Correlation Between Liaoning Dingjide and Fujian Anjoy
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By analyzing existing cross correlation between Liaoning Dingjide Petrochemical and Fujian Anjoy Foods, you can compare the effects of market volatilities on Liaoning Dingjide and Fujian Anjoy 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 Liaoning Dingjide with a short position of Fujian Anjoy. Check out your portfolio center. Please also check ongoing floating volatility patterns of Liaoning Dingjide and Fujian Anjoy.
Diversification Opportunities for Liaoning Dingjide and Fujian Anjoy
-0.41 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Liaoning and Fujian is -0.41. Overlapping area represents the amount of risk that can be diversified away by holding Liaoning Dingjide Petrochemica and Fujian Anjoy Foods in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fujian Anjoy Foods and Liaoning Dingjide 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 Liaoning Dingjide Petrochemical are associated (or correlated) with Fujian Anjoy. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fujian Anjoy Foods has no effect on the direction of Liaoning Dingjide i.e., Liaoning Dingjide and Fujian Anjoy go up and down completely randomly.
Pair Corralation between Liaoning Dingjide and Fujian Anjoy
Assuming the 90 days trading horizon Liaoning Dingjide Petrochemical is expected to generate 2.65 times more return on investment than Fujian Anjoy. However, Liaoning Dingjide is 2.65 times more volatile than Fujian Anjoy Foods. It trades about -0.11 of its potential returns per unit of risk. Fujian Anjoy Foods is currently generating about -0.33 per unit of risk. If you would invest 3,350 in Liaoning Dingjide Petrochemical on October 18, 2024 and sell it today you would lose (368.00) from holding Liaoning Dingjide Petrochemical or give up 10.99% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Liaoning Dingjide Petrochemica vs. Fujian Anjoy Foods
Performance |
| Timeline |
| Liaoning Dingjide |
| Fujian Anjoy Foods |
Liaoning Dingjide and Fujian Anjoy Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Liaoning Dingjide and Fujian Anjoy
The main advantage of trading using opposite Liaoning Dingjide and Fujian Anjoy positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Liaoning Dingjide position performs unexpectedly, Fujian Anjoy 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 Fujian Anjoy will offset losses from the drop in Fujian Anjoy's long position.| Liaoning Dingjide vs. Beijing Yanjing Brewery | Liaoning Dingjide vs. Haima Automobile Group | Liaoning Dingjide vs. Suzhou Oriental Semiconductor | Liaoning Dingjide vs. Guangzhou Haige Communications |
| Fujian Anjoy vs. Yangmei Chemical Co | Fujian Anjoy vs. Tongyu Communication | Fujian Anjoy vs. Ningxia Younglight Chemicals | Fujian Anjoy vs. Liaoning Dingjide Petrochemical |
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 Equity Forecasting module to use basic forecasting models to generate price predictions and determine price momentum.
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