Correlation Between ANJI Technology and Century Wind
Can any of the company-specific risk be diversified away by investing in both ANJI Technology and Century Wind at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining ANJI Technology and Century Wind into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ANJI Technology Co and Century Wind Power, you can compare the effects of market volatilities on ANJI Technology and Century Wind 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 ANJI Technology with a short position of Century Wind. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANJI Technology and Century Wind.
Diversification Opportunities for ANJI Technology and Century Wind
-0.7 | Correlation Coefficient |
Excellent diversification
The 3 months correlation between ANJI and Century is -0.7. Overlapping area represents the amount of risk that can be diversified away by holding ANJI Technology Co and Century Wind Power in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Century Wind Power and ANJI Technology 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 ANJI Technology Co are associated (or correlated) with Century Wind. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Century Wind Power has no effect on the direction of ANJI Technology i.e., ANJI Technology and Century Wind go up and down completely randomly.
Pair Corralation between ANJI Technology and Century Wind
Assuming the 90 days trading horizon ANJI Technology Co is expected to generate 1.06 times more return on investment than Century Wind. However, ANJI Technology is 1.06 times more volatile than Century Wind Power. It trades about -0.03 of its potential returns per unit of risk. Century Wind Power is currently generating about -0.1 per unit of risk. If you would invest 4,700 in ANJI Technology Co on October 30, 2024 and sell it today you would lose (730.00) from holding ANJI Technology Co or give up 15.53% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
ANJI Technology Co vs. Century Wind Power
Performance |
| Timeline |
| ANJI Technology |
| Century Wind Power |
ANJI Technology and Century Wind Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ANJI Technology and Century Wind
The main advantage of trading using opposite ANJI Technology and Century Wind positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANJI Technology position performs unexpectedly, Century Wind 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 Century Wind will offset losses from the drop in Century Wind's long position.| ANJI Technology vs. TSEC Corp | ANJI Technology vs. United Renewable Energy | ANJI Technology vs. Tainergy Tech Co | ANJI Technology vs. Motech Industries Co |
| Century Wind vs. Sun Sea Construction | Century Wind vs. Lihtai Construction Enterprise | Century Wind vs. Kinsus Interconnect Technology | Century Wind vs. Vate Technology Co |
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 Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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