Correlation Between Allied Machinery and Biwin Storage
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By analyzing existing cross correlation between Allied Machinery Co and Biwin Storage Technology, you can compare the effects of market volatilities on Allied Machinery and Biwin Storage 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 Allied Machinery with a short position of Biwin Storage. Check out your portfolio center. Please also check ongoing floating volatility patterns of Allied Machinery and Biwin Storage.
Diversification Opportunities for Allied Machinery and Biwin Storage
0.76 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Allied and Biwin is 0.76. Overlapping area represents the amount of risk that can be diversified away by holding Allied Machinery Co and Biwin Storage Technology in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Biwin Storage Technology and Allied Machinery 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 Allied Machinery Co are associated (or correlated) with Biwin Storage. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Biwin Storage Technology has no effect on the direction of Allied Machinery i.e., Allied Machinery and Biwin Storage go up and down completely randomly.
Pair Corralation between Allied Machinery and Biwin Storage
Assuming the 90 days trading horizon Allied Machinery Co is expected to generate 0.64 times more return on investment than Biwin Storage. However, Allied Machinery Co is 1.56 times less risky than Biwin Storage. It trades about 0.15 of its potential returns per unit of risk. Biwin Storage Technology is currently generating about -0.03 per unit of risk. If you would invest 1,514 in Allied Machinery Co on September 1, 2024 and sell it today you would earn a total of 119.00 from holding Allied Machinery Co or generate 7.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Allied Machinery Co vs. Biwin Storage Technology
Performance |
| Timeline |
| Allied Machinery |
| Biwin Storage Technology |
Allied Machinery and Biwin Storage Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Allied Machinery and Biwin Storage
The main advantage of trading using opposite Allied Machinery and Biwin Storage positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Allied Machinery position performs unexpectedly, Biwin Storage 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 Biwin Storage will offset losses from the drop in Biwin Storage's long position.| Allied Machinery vs. New China Life | Allied Machinery vs. Ming Yang Smart | Allied Machinery vs. 159681 | Allied Machinery vs. 159005 |
| Biwin Storage vs. Industrial and Commercial | Biwin Storage vs. Kweichow Moutai Co | Biwin Storage vs. Agricultural Bank of | Biwin Storage vs. China Mobile Limited |
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 Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
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