Correlation Between Anhui Transport and Shanghai Construction
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By analyzing existing cross correlation between Anhui Transport Consulting and Shanghai Construction Group, you can compare the effects of market volatilities on Anhui Transport and Shanghai Construction 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 Shanghai Construction. Check out your portfolio center. Please also check ongoing floating volatility patterns of Anhui Transport and Shanghai Construction.
Diversification Opportunities for Anhui Transport and Shanghai Construction
0.74 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Anhui and Shanghai is 0.74. Overlapping area represents the amount of risk that can be diversified away by holding Anhui Transport Consulting and Shanghai Construction Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Shanghai Construction 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 Shanghai Construction. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Shanghai Construction has no effect on the direction of Anhui Transport i.e., Anhui Transport and Shanghai Construction go up and down completely randomly.
Pair Corralation between Anhui Transport and Shanghai Construction
Assuming the 90 days trading horizon Anhui Transport Consulting is expected to generate 0.87 times more return on investment than Shanghai Construction. However, Anhui Transport Consulting is 1.15 times less risky than Shanghai Construction. It trades about -0.02 of its potential returns per unit of risk. Shanghai Construction Group is currently generating about -0.08 per unit of risk. If you would invest 875.00 in Anhui Transport Consulting on November 5, 2024 and sell it today you would lose (4.00) from holding Anhui Transport Consulting or give up 0.46% 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. Shanghai Construction Group
Performance |
| Timeline |
| Anhui Transport Cons |
| Shanghai Construction |
Anhui Transport and Shanghai Construction Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Anhui Transport and Shanghai Construction
The main advantage of trading using opposite Anhui Transport and Shanghai Construction positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Anhui Transport position performs unexpectedly, Shanghai Construction 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 Shanghai Construction will offset losses from the drop in Shanghai Construction's long position.| Anhui Transport vs. North Copper Shanxi | Anhui Transport vs. Tibet Huayu Mining | Anhui Transport vs. Shenzhen Noposion Agrochemicals | Anhui Transport vs. Ningbo Jintian Copper |
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 Instant Ratings module to determine any equity ratings based on digital recommendations. Macroaxis instant equity ratings are based on combination of fundamental analysis and risk-adjusted market performance.
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