Correlation Between Aofu Environmental and Sinosteel Engineering
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By analyzing existing cross correlation between Aofu Environmental Technology and Sinosteel Engineering and, you can compare the effects of market volatilities on Aofu Environmental and Sinosteel Engineering 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 Sinosteel Engineering. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aofu Environmental and Sinosteel Engineering.
Diversification Opportunities for Aofu Environmental and Sinosteel Engineering
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Aofu and Sinosteel is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Aofu Environmental Technology and Sinosteel Engineering and in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Sinosteel Engineering and 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 Sinosteel Engineering. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Sinosteel Engineering and has no effect on the direction of Aofu Environmental i.e., Aofu Environmental and Sinosteel Engineering go up and down completely randomly.
Pair Corralation between Aofu Environmental and Sinosteel Engineering
Assuming the 90 days trading horizon Aofu Environmental Technology is expected to generate 1.23 times more return on investment than Sinosteel Engineering. However, Aofu Environmental is 1.23 times more volatile than Sinosteel Engineering and. It trades about 0.16 of its potential returns per unit of risk. Sinosteel Engineering and is currently generating about 0.11 per unit of risk. If you would invest 1,125 in Aofu Environmental Technology on September 5, 2024 and sell it today you would earn a total of 106.00 from holding Aofu Environmental Technology or generate 9.42% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aofu Environmental Technology vs. Sinosteel Engineering and
Performance |
| Timeline |
| Aofu Environmental |
| Sinosteel Engineering and |
Aofu Environmental and Sinosteel Engineering Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aofu Environmental and Sinosteel Engineering
The main advantage of trading using opposite Aofu Environmental and Sinosteel Engineering positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aofu Environmental position performs unexpectedly, Sinosteel Engineering 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 Sinosteel Engineering will offset losses from the drop in Sinosteel Engineering's long position.| Aofu Environmental vs. Zijin Mining Group | Aofu Environmental vs. Baoshan Iron Steel | Aofu Environmental vs. Rongsheng Petrochemical Co | Aofu Environmental vs. Shandong Gold Mining |
| Sinosteel Engineering vs. China Life Insurance | Sinosteel Engineering vs. Cinda Securities Co | Sinosteel Engineering vs. Piotech Inc A | Sinosteel Engineering vs. Dongxing Sec 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 Bonds Directory module to find actively traded corporate debentures issued by US companies.
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