Correlation Between Aofu Environmental and Tieling Newcity
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By analyzing existing cross correlation between Aofu Environmental Technology and Tieling Newcity Investment, you can compare the effects of market volatilities on Aofu Environmental and Tieling Newcity 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 Aofu Environmental with a short position of Tieling Newcity. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aofu Environmental and Tieling Newcity.
Diversification Opportunities for Aofu Environmental and Tieling Newcity
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Aofu and Tieling is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Aofu Environmental Technology and Tieling Newcity Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tieling Newcity Inve and Aofu Environmental 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 Aofu Environmental Technology are associated (or correlated) with Tieling Newcity. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tieling Newcity Inve has no effect on the direction of Aofu Environmental i.e., Aofu Environmental and Tieling Newcity go up and down completely randomly.
Pair Corralation between Aofu Environmental and Tieling Newcity
Assuming the 90 days trading horizon Aofu Environmental Technology is expected to under-perform the Tieling Newcity. In addition to that, Aofu Environmental is 1.18 times more volatile than Tieling Newcity Investment. It trades about -0.05 of its total potential returns per unit of risk. Tieling Newcity Investment is currently generating about 0.02 per unit of volatility. If you would invest 315.00 in Tieling Newcity Investment on October 15, 2024 and sell it today you would earn a total of 9.00 from holding Tieling Newcity Investment or generate 2.86% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 99.79% |
| Values | Daily Returns |
Aofu Environmental Technology vs. Tieling Newcity Investment
Performance |
| Timeline |
| Aofu Environmental |
| Tieling Newcity Inve |
Aofu Environmental and Tieling Newcity Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aofu Environmental and Tieling Newcity
The main advantage of trading using opposite Aofu Environmental and Tieling Newcity positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aofu Environmental position performs unexpectedly, Tieling Newcity 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 Tieling Newcity will offset losses from the drop in Tieling Newcity's long position.| Aofu Environmental vs. Penyao Environmental Protection | Aofu Environmental vs. Shenwu Energy Saving | Aofu Environmental vs. Shenzhen MYS Environmental | Aofu Environmental vs. GreenTech Environmental Co |
| Tieling Newcity vs. Lutian Machinery Co | Tieling Newcity vs. Shenzhen Zhongzhuang Construction | Tieling Newcity vs. Panda Dairy Corp | Tieling Newcity vs. Xingguang Agricultural Mach |
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 Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.
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