Correlation Between Aofu Environmental and First Capital
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By analyzing existing cross correlation between Aofu Environmental Technology and First Capital Securities, you can compare the effects of market volatilities on Aofu Environmental and First Capital 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 First Capital. Check out your portfolio center. Please also check ongoing floating volatility patterns of Aofu Environmental and First Capital.
Diversification Opportunities for Aofu Environmental and First Capital
0.67 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Aofu and First is 0.67. Overlapping area represents the amount of risk that can be diversified away by holding Aofu Environmental Technology and First Capital Securities in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Capital Securities 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 First Capital. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Capital Securities has no effect on the direction of Aofu Environmental i.e., Aofu Environmental and First Capital go up and down completely randomly.
Pair Corralation between Aofu Environmental and First Capital
Assuming the 90 days trading horizon Aofu Environmental Technology is expected to under-perform the First Capital. In addition to that, Aofu Environmental is 1.16 times more volatile than First Capital Securities. It trades about -0.43 of its total potential returns per unit of risk. First Capital Securities is currently generating about -0.44 per unit of volatility. If you would invest 928.00 in First Capital Securities on October 15, 2024 and sell it today you would lose (194.00) from holding First Capital Securities or give up 20.91% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Aofu Environmental Technology vs. First Capital Securities
Performance |
| Timeline |
| Aofu Environmental |
| First Capital Securities |
Aofu Environmental and First Capital Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Aofu Environmental and First Capital
The main advantage of trading using opposite Aofu Environmental and First Capital positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Aofu Environmental position performs unexpectedly, First Capital 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 First Capital will offset losses from the drop in First Capital's long position.| Aofu Environmental vs. Jiangsu Jinling Sports | Aofu Environmental vs. Shandong Iron and | Aofu Environmental vs. Dynagreen Environmental Protection | Aofu Environmental vs. China Sports Industry |
| First Capital vs. Pengxin International Mining | First Capital vs. Shenzhen MYS Environmental | First Capital vs. Tibet Huayu Mining | First Capital vs. Aofu Environmental Technology |
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 CEOs Directory module to screen CEOs from public companies around the world.
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