Correlation Between Anhui Transport and Lianhe Chemical
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By analyzing existing cross correlation between Anhui Transport Consulting and Lianhe Chemical Technology, you can compare the effects of market volatilities on Anhui Transport and Lianhe Chemical 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 Anhui Transport with a short position of Lianhe Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Transport and Lianhe Chemical.
Diversification Opportunities for Anhui Transport and Lianhe Chemical
0.88 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Anhui and Lianhe is 0.88. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Transport Consulting and Lianhe Chemical Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Lianhe Chemical Tech and Anhui Transport 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 Anhui Transport Consulting are associated (or correlated) with Lianhe Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Lianhe Chemical Tech has no effect on the direction of Anhui Transport i.e., Anhui Transport and Lianhe Chemical go up and down completely randomly.
Pair Corralation between Anhui Transport and Lianhe Chemical
Assuming the 90 days trading horizon Anhui Transport Consulting is expected to under-perform the Lianhe Chemical. But the stock apears to be less risky and, when comparing its historical volatility, Anhui Transport Consulting is 2.25 times less risky than Lianhe Chemical. The stock trades about -0.13 of its potential returns per unit of risk. The Lianhe Chemical Technology is currently generating about 0.12 of returns per unit of risk over similar time horizon. If you would invest 558.00 in Lianhe Chemical Technology on October 23, 2024 and sell it today you would earn a total of 39.00 from holding Lianhe Chemical Technology or generate 6.99% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Transport Consulting vs. Lianhe Chemical Technology
Performance |
| Timeline |
| Anhui Transport Cons |
| Lianhe Chemical Tech |
Anhui Transport and Lianhe Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Transport and Lianhe Chemical
The main advantage of trading using opposite Anhui Transport and Lianhe Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Transport position performs unexpectedly, Lianhe Chemical 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 Lianhe Chemical will offset losses from the drop in Lianhe Chemical's long position.| Anhui Transport vs. Threes Company Media | Anhui Transport vs. Changjiang Publishing Media | Anhui Transport vs. Ciwen Media Co | Anhui Transport vs. Beijing Enlight Media |
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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 Piotroski F Score module to get Piotroski F Score based on the binary analysis strategy of nine different fundamentals.
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