Correlation Between Anhui Transport and Changchun
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By analyzing existing cross correlation between Anhui Transport Consulting and Changchun UP Optotech, you can compare the effects of market volatilities on Anhui Transport and Changchun 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 Changchun. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Transport and Changchun.
Diversification Opportunities for Anhui Transport and Changchun
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Anhui and Changchun is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Transport Consulting and Changchun UP Optotech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Changchun UP Optotech 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 Changchun. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Changchun UP Optotech has no effect on the direction of Anhui Transport i.e., Anhui Transport and Changchun go up and down completely randomly.
Pair Corralation between Anhui Transport and Changchun
Assuming the 90 days trading horizon Anhui Transport Consulting is expected to under-perform the Changchun. But the stock apears to be less risky and, when comparing its historical volatility, Anhui Transport Consulting is 1.55 times less risky than Changchun. The stock trades about -0.15 of its potential returns per unit of risk. The Changchun UP Optotech is currently generating about -0.05 of returns per unit of risk over similar time horizon. If you would invest 4,126 in Changchun UP Optotech on October 25, 2024 and sell it today you would lose (276.00) from holding Changchun UP Optotech or give up 6.69% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Anhui Transport Consulting vs. Changchun UP Optotech
Performance |
| Timeline |
| Anhui Transport Cons |
| Changchun UP Optotech |
Anhui Transport and Changchun Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Transport and Changchun
The main advantage of trading using opposite Anhui Transport and Changchun positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Transport position performs unexpectedly, Changchun 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 Changchun will offset losses from the drop in Changchun's long position.| Anhui Transport vs. Kweichow Moutai Co | Anhui Transport vs. Contemporary Amperex Technology | Anhui Transport vs. Beijing Roborock Technology | Anhui Transport vs. BYD Co Ltd |
| Changchun vs. Kweichow Moutai Co | Changchun vs. Contemporary Amperex Technology | Changchun vs. Beijing Roborock Technology | Changchun vs. BYD Co Ltd |
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 Efficient Frontier module to plot and analyze your portfolio and positions against risk-return landscape of the market..
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